country water resources assistance...

December 20, 2005

Document of the World BankR

eport No. 32312-B

DB

angladesh Country W

ater Resources A

ssistance Strategy

Report No. 32312-BD

BangladeshCountry Water Resources Assistance Strategy

Environment and Social Development UnitAgriculture and Rural Development UnitEnergy and Infrastructure UnitSouth Asia Region

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Contents

Abbreviations and Acronyms

Acknowledgments ......................................................................................................................................... i Executive Summary ................................................................................................................................... ii

1 . 2 . Objectives o f this Country Water Resources Assistance Strategy ................................................... 7

3 . Water and Sustainable Poverty Reduction in Bangladesh ............................................................... 9

4 . The Water Resources Sector ............................................................................................................. 22

5 . The Service Sectors ............................................................................................................................ 29

6 . Annex 1 . Types of Activities for World Bank Engagement: Long Term .......................................... A-1

Annex 2 . Relationship between Bank Portfolio and National Water Management Plan ................ A-2

Annex 3 . World Bank Operational Policy (OP 7.50) on International Waterways ......................... A-5

References

Development Context and Introduction ............................................................................................. 1

Priorities for World Bank Engagement ........................................................................................... 43

Tables Table A . Medium- to Long-Term Programmatic Areas for Support t o Water-Related Activities .............. ix

Table 1 . People’s Own Perception of Status in Three Ulipur Villages before and after 1998 Floods ....... 16

Table 2 . Development Partners Assistance to the Bangladesh Water (for Agriculture) Sector ................. 27

Table 3 . Summary o f Major Fish Subsector Scenarios .............................................................................. 40

Table 4 . Medium- to Long-Term Programmatic Areas for Support to Water-Related Activities .............. 53

Figures Figure 1 . Linkages between Poverty and Water and Sanitation ................................................................... 3

Figure 2 . Relationship of Water Resources to Water Service Sectors ......................................................... 4

Figure 3 . Water Resources Interventions and Effects o n Poverty ................................................................ 6

Figure 4 . The Ganges. Brahmaputra and Meghna Basins .......................................................................... 10

Figure 5 . Impacts o f Large-Scale Disasters in Bangladesh ........................................................................ 13

Figure 6 . Bangladesh Flood Damage ......................................................................................................... 16

Figure 7 . Investment in Water for Agnculture ........................................................................................... 26

Figure 8 . Profi le o f Arsenic Occurrence in Groundwater .......................................................................... 33

Boxes Box 1 . M a i n Messages o f the Wor ld Bank’s Water Resources Sector Strategy (2003) ............................... 5 Box 2 . Instability and Erosion in the Brahmaputra-Jamuna River System ................................................. 14

Acknowledgments

This Country Water Resources Assistance Strategy was developed in a process o f multiple workshops and consultations held in Bangladesh over the time period 2003 to 2005. In addition to the inputs from the many government officials, development partners, NGOs and individual experts who were consulted during this process, the document draws on five background papers, covering the fol lowing topics: water resources, irrigation, fisheries, inland water transport and water supply and sanitation, prepared by a team o f consultants very familiar with these topics. The Country Water Resources Assistance Strategy document i s a jo in t product o f the South Asia Environment and Social Development Unit (SASES), the South Asia Agriculture and Rural Development Unit (SASAR), the South Asia Energy and Infrastructure Unit (SASEI) and the Water and Sanitation Program (WSP)- South Asia. The team consisted o f Kar in Kemper (task team leader, SASES), John Briscoe, Mohinder S. Mudahar, S. A. M. Rafiquzzaman (SASAR), Khawaja Minnatullah (WSP), A la in Locussol, Jaehyang So (SASEI), Catherine Tovey (SASES), Herb Wiebe (lead consultant), Sharif Uzzaman Choudhury, Bill Collis, Haroon Rashid, and M. H. Siddiqi (consultants).

The team would l ike to express their gratitude to Jeffrey Racki (Acting Director, South Asia Social and Environment Unit), Gajan Pathmanathan (Sector Manager, South Asia Rural Development and Agnculture Unit) and C h s t i n e Wal l ich (Country Director, Bangladesh) for their guidance during the development o f this strategy. Valuable comments and contributions from Vincent Gouarne, Guang Zhe Chen, M o h i U z Zaman Quazi, Paul Dorosh, Kees Kostermans, Zahed Khan, and Ni lufar Ahmad, and f rom the peer reviewers Kei th Pitman, Junaid Ahmad, and Guy Alaerts are gratefully acknowledged. Administrative support was provided by Swarna Kazi, Tarak Chandra Sarker, Md. Abul Fayez Khan and Razia Sultana. The document was edited by John Dawson. Sadaf Alam, Siet Meijer, Cecilia Belita, and Catherine Tovey managed publication arrangements. - The team i s thankful to the Bank Netherlands Water Partnership Program (BNWPP) which provided important co-funding for the development o f this strategy.

i

Executive Summary

Development Context and Introduction 1.

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The population o f Bangladesh i s forecast to increase from about 133 mi l l ion to over 220 mi l l ion by 2050. Urban centers are expected to absorb most o f the incremental population, growing f rom the present 30 m i l l i on to about 130 mill ion. T h i s population growth combined with. economic growth will increasingly stress water resources and this has the potential t o be the dominant environmental and possibly the most important development issue facing Bangladesh in the coming hal f century.

Significant investments in infrastructure wi l l be required to provide potable water to the expanding urban centers. Currently, delivery systems provide about 10,000 m i l l i on liters per day; future demand i s expected to be something over 35,000 million liters per day. The problem o f meeting such a demand i s complicated by arsenic contamination, t o which almost ha l f o f the population i s presently exposed at levels exceeding Wor ld Health Organization (WHO) guideline values. Urban and industrial pollution around urban centers i s currently affecting fresh water quality and with expansion o f the urban centers, the human excreta load wil l increase f rom the present 1,500 metric tons per day to a projected 6,000 metric tons per day, whi le solid wastes will increase f rom 4,500 to 19,000 metric tons per day.

T o maintain food security, increases in grain production o f about 20 m i l l i on metric tons will be required by 2050; among other technological improvements, this will require increases in irrigated cropped area. However, increased pesticide use associated with more intensive production will continue to degrade the fresh water resources, since about 15% o f these pesticides are washed f rom the farmland.

The demand for f i sh i s expected to increase from the present 2.2 m i l l i on metric tons to something between 5.5 and 8 m i l l i on metric tons by 2025. The incremental production wil l need to be derived from inland aquaculture through some combination of increasing production per unit area, increasing area under production, and increasing imports. Fish currently provide 65% o f the country’s animal protein consumption and are a critical source o f essential minerals, vitamins, and fatty acids. The poorest people in Bangladesh depend o n fisheries both for their livelihoods and their source o f protein, and reduced per capita f i sh supplies translate into higher prices and reduced access.

Water i s instrumental in the performance o f a number o f economic sectors in Bangladesh, including agriculture, fisheries, industry and commerce, navigation, and health. Agriculture, which accounts for about 19% o f the gross domestic product (GDP), has expanded between 2% and 2.5% over the past two decades and employs about 63% o f the labor force. The fisheries sector, which accounts for roughly 4% o f GDP and provides 9% o f the country’s employment, i s the second most important earner o f foreign exchange, and provides 65% o f the country’s animal protein. Inland capture fisheries have been declining, in part because o f a lack o f dry season water resulting f rom the loss o f perennial wetlands, irrigation abstractions, encroachment, and pollution. Inland and brackish water aquaculture are not so affected, with annual growth rates exceeding 10% over the past decade. Transport accounts for about 8% o f GDP and water transport accounts for about 15% o f total transport GDP. Inland water transport i s very competitive but has been adversely affected by siltation, declining flows, and deteriorating water management infrastructure and has not received financial allocations commensurate with i t s potential. Given the dominant role that water plays in the performance o f key economic sectors in Bangladesh, and allowing that economic growth i s the single most important factor influencing poverty, i t follows that water and poverty are closely related. Water, as a basic resource, i s instrumental in creating and sustaining employment opportunities and, as a corollary, water-related interventions that

Executive Summary: Country Water Resources Assistance Strategy

increase the use o f labor are pro-poor. Inadequate water and sanitation services have a particularly adverse effect on the poor, on their health, and accordingly on their abil ity to contribute to economic development.

Objective of this Country Water Resources Assistance Strategy 6. The mission o f the Wor ld Bank i s poverty reduction. Water i s a key issue in achieving this

objective in Bangladesh, and the Bank has long been involved in the country’s water sector. This Country Water Resources Assistance Strategy (CWRAS) describes what the Bank can and will do to help improve country-level water management, and, thereby, assist the Government o f Bangladesh in choosing water sector activities that the Bank can engage in strategically: activities that are expected to have the most impact on long-term systemic challenges; that fit with the Bank’s comparative advantages; and that support Bangladesh’s Poverty Reduction Strategy implementation and complement the Bank’s Country Assistance Strategy.

Water and Sustainable Poverty Reduction in Bangladesh 7. Bangladesh has a total area o f about 14.7 mi l l ion hectares (ha) and a net cultivable area o f about 8

m i l l i on ha. The two primary sources o f water are local rainfall amounting to about 250 cubic kilometers (km3) annually and fall ing mainly between July and October; and transboundary inflows amounting to about 1,000 h3 annually derived mainly f rom the Brahmaputra, Meghna, and Ganges Rivers, with greatest f low also occurring between July and October. Bangladesh occupies only 8% o f the total area o f these three basins but i s the point o f concentration o f their catchments. The result i s excess o f surface water during the summer months and water shortfalls in the winter months.

8. The National Water Policy acknowledges that Bangladesh, as the lower riparian, has l imi ted control over rivers entering i t s borders and that i t i s affected by the significant upstream diversions and abstractions that reduce water availability during the dry winter months; by the absence o f upstream hydrometric data that inhibits responses in periods o f both f lood and drought; and by the general poor quality o f water entering the country f rom upstream in some o f the basins. I t further recognizes that the situation i s progressively becoming worse as population densities are increasing, economic activity i s increasing, and water quality i s deteriorating. The net result i s that per capita supply o f renewable water i s declining throughout the basins that Bangladesh shares with India. Reduced water availability in the Ganges-dependent area has affected the southwest region o f Bangladesh in a number o f ways, including increased saline intrusion, changes to river morphology, and increased environmental hazards, threatening the security o f the natural aquatic resources, including the Sundarbans Wor ld Heritage Site. The Ganges Treaty has, nevertheless, been better for Bangladesh than the no-Treaty alternative and highlights the importance o f Bangladesh redoubling i t s efforts to engage constructively with India in finding mutually acceptable water- and benefit-sharing agreements on the major rivers they share. The importance o f such agreements i s highlighted by the Indian explorations o f transfer o f water f rom surplus to deficit basins (the so-called “linlung o f rivers”). It should be noted that India is, for the time being, concentrating on the peninsular rivers. A suggested starting point for Bangladesh i s t o undertake an objective assessment o f where there might be commonalities o f interest with India and to build on these to create outcomes that might be mutually advantageous.

Bangladesh i s generally considered to be vulnerable to potential changes in climate because it has a high population density, i s located o n a low-ly ing delta, and i s subject to heavy rainfal l and inflows of large volumes o f transboundary surface water confined to a relatively short monsoon season. Adapting to climate change needs to be considered a requirement for sustainable development in Bangladesh because o f the broad range o f l ikely impacts. Because o f the extent to which climate change would affect the land and water use systems, a better understanding o f i t s impacts should be promoted and more specific plans should be prepared and implemented. M u c h

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of the existing water resources infrastructure in Bangladesh has exceeded i t s design l i f e and requires rehabilitation. This provides an opportunity to plan and design for climate change in a proactive manner.

Bangladesh i s subject to water-related hazards such as cyclones, storm surges, droughts, floods, and r iver erosion. In practice the poor are most affected because they l ive in greater density in the most poor ly constructed housing in settlements located o n lands prone to hazards. Between 1970 and 1998, 171 large-scale disasters were recorded in Bangladesh. T h i s translates in to an annual frequency o f 6.1 1 , making Bangladesh the most disaster prone o f a l l countries. Over the 28 years of record, these disasters have k i l led an estimated ha l f mi l l ion people and affected each person an average o f four times. Bangladesh has successfully reduced the impact o f disasters through community involvement in planning and risk management; however, response efforts st i l l pr imari ly focus o n emergency rel ief rather than seeking ways to reduce vulnerability to natural hazards. There i s a need to strengthen the awareness that r i s k reduction and disaster prevention make better humanitarian and economic sense than emergency relief, which only responds to the consequences o f a natural hazard.

I t has generally been accepted that for water management investments to be effective, local stakeholders and professionals would need to work side by side as partners at a l l stages o f project planning and implementation. The various categories o f water resources interventions generally require a diverse range o f unique institutional structures to support participatory management. Based o n conventional wisdom and experience from past practice, a few institutional models are being tested that have the potential to achieve the dual objective o f establishing an acceptable and sustainable institutional framework, and successful and sustainable cost recovery. Nevertheless, more effort needs to be directed towards refining these and regardless o f h o w attractive a proposed investment might be f rom a technical standpoint, the institutional aspects continue to be cause for concern.

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12. Success has been elusive in the many attempts to achieve effective long-term operation and maintenance o f f lood control and drainage interventions. T o facilitate financing and more effective operation and maintenance o f water management infrastructure, consideration needs to be given to classifying infrastructure into two main categories: that which serves the national common good, and that which i s local infrastructure. Infrastructure designated as serving the national common good would remain under the control o f the government-designated agency with rehabilitation, operation, and maintenance financed entirely by government. Rehabilitation o f infrastructure designated as local would require a significant pr ior financial commitment f rom local stakeholders for long-term operation and maintenance, and, to the extent practicable, would be implemented through or by local government.

T h e W a t e r Resources Sector 13. Efforts to systematically develop Bangladesh’s water resources started in the 18’ century and

were expanded under the Zamindar system, extending to the present. During this time the water resources information base has improved, analytical processes have been strengthened, and the institutional and pol icy framework has evolved. In addition, a significant amount o f infrastructure has been put in place to manage water for more economically productive purposes.

Fol lowing the establishment o f a Water and Power Development Authority, an outcome of a 1954 United Nations Technical Mission, a Water Master Plan was completed in 1964. This plan emphasized large-scale publicly financed surface water development, overestimated publ ic sector capability, and overlooked the country’s groundwater resources. In 1972, the World Bank supported preparation o f a Land and Water Resources Sector Study, which promoted a radical shift in strategy to minor development using low- l i f t pumps to irrigate with surface water and tubewells to irrigate with groundwater. The first framework National Water Plan, sponsored by

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the Uni ted Nations Development Programme (UNDP) and executed by the Wor ld Bank, was produced in 1987 and was followed by a second phase that was to operationalize i t s main strategic thrusts and produce an investment plan for 1992; however, the advent o f devastating floods in 1987 and 1988 refocused attention on this hazard and gave rise t o the internationally sponsored Flood Act ion Plan (1989-1994). The 1995 Water and F lood Management Strategy synergized the earlier National Water Plan with the outputs o f the Flood Act ion Plan, promoted a broader technical approach to water resources planning, promoted a reduced public sector role in water management, identified the need for a National Water Policy, and recommended preparation o f a broad-based National Water Management Plan, which wou ld be guided by the policy. In 1999 the government declared the f i rs t National Water Policy. The pol icy has spawned a number o f related initiatives including the preparation o f a National Water Code, completion o f the National Water Management Plan, and finalization o f the Guidelines for Participatory Water Management. The policy fed directly into the Government’s Poverty Reduction Strategy Paper, entitled Unlocking the Potential - National Strategy for Accelerated Poverty Reduction which was finalized in October 2005.

An extensive pol icy framework exists, developed mostly over the last 10 years, t o govern water resources development and management. K e y among these are the declaration o f a National Water Policy (1999); the National Water Management Plan (2004); progress towards declaring a National Water Code; and preparation o f a Coastal Zone Policy (2005). In addition, a number o f related policies of importance to the water sector have been set in place. These include the National Environment Policy (1 992); the National Forestry Policy (1 994); the National Energy Policy (1996); the National Policy for Safe Water Supply and Sanitation (1998); the National Fisheries Policy (1998); and the National Agriculture Policy (1999). The National Water Management Plan identified two gaps in the pol icy framework. The f i rs t related to the need for land use planning to address such issues as urban expansion, and plans and developments in sectors including industry, energy, education, and health, as wel l as water. The second related to the need for an integrated transport pol icy that would lead to more rational investment and upgrading o f the various modes o f transport.

There are both national and local government institutions that are relevant t o the water sector. The national institutions comprise some 35 central government organizations affiliated with 13 different ministries. The local government institutions include 4 ci ty corporations, 206 municipalities, and the local government administrations at the levels o f district (64), thana (464), union (4,45 l), and village (86,500). Nongovernmental organizations (NGOs) and the private sector have also played an important role in the development o f water resources. The National Water Management Plan envisages some fundamental changes in the institutional framework in the future. The sector i s l ikely to be managed through national and regional framework plans that reflect the government’s policies, as we l l as stakeholders’ demands. The p lan foresees a sector that i s regulated under l aw with new independent regulatory bodies formed to ensure quality and cost-effective water service delivery. The Bangladesh Water Development Board (BWDB) will be encouraged to operate on a regional basis and the present District-Level Inter-Agency Project Evaluation Committee coordination system will be replaced by district committees under local government. The plan also foresees a strengthened local government that increasingly takes o n the task o f managing local water resources for agriculture, water supply, sanitation, urban and peri-urban services, and cyclone protection shelters. The principal departments supporting this effort will be the Local Government Engineering Department (LGED) and the Department o f Public Health Engineering (DPHE).

Since the 1950s, more than 600 water resources schemes have been completed. The majority o f these were intended to increase crop production and varied in size f r o m small single structure schemes with an impacted area of less than 1,000 ha to large multipurpose schemes potentially

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impacting o n as much as 100,000 ha. Most were designed to provide f lood control, drainage, irrigation, or some combination o f these. Others provide riverbank protection or r iver dredging. At the same time, there was massive private sector growth o f minor irrigation f rom around 1986 to the present, which i s now bigger than public programs.

Since 1971, public investments in water for agriculture have exceeded US$5 b i l l ion (in real terms) and this has translated to between US$165 mi l l ion and US$260 mi l l ion annually. Government financing for the sector averaged about US$1 10 m i l l i on annually and this has been consistent for the past two decades. Project-related donor assistance declined f rom an annual average o f about US$l50 mi l l ion during the f irst ha l f o f the 1990s to an annual’average of about US$55 mi l l i on during the past few years. Between 1999 to the present, the Wor ld Bank undertook n o new investments in the water resources sector, which contributed substantially t o the overall decline in the level o f donor assistance. Since many o f the donors build o n the experience and expertise o f the Bank in determining their own funding allocations and in developing their own programs, the impact o f the Bank’s decision to withdraw support f rom the sector was magnified as others followed suit.

The decline in multilateral and bilateral support to the sector was the outcome o f a general perception that investments needed to be more effective and this required improving a l l aspects of service delivery. The precipitous decline in Bank support during the latter h a l f o f the 1990s was partly a result o f worldwide reductions in Bank lending for water-related infrastructure, and partly specific to Bangladesh, where there were concerns about misprocurement and a failure to reform key water institutions. In part stimulated by such concerns (which were not l imi ted to the Bank or the donor community), the government, with strong Bank support, init iated a series o f reforms aimed at restructuring and rejuvenating key agencies, promoting a process o f participatory water management, rationalizing the national water management planning process, and developing improved systems for service delivery, including more robust procurement systems.

In reviewing past donor investments, a number o f common elements recur that appear to contribute to some projects performing better than others. K e y among these for the public sector- financed schemes i s the stronger (than in the past) involvement o f end users. For minor irrigation, end users are and have always been the driving force. In many interventions, end user involvement i s confirmed by their willingness to commit to financial contributions in advance o f receiving services. This has been facilitated by a recent change in legislation that permits financial resources collected for operation and maintenance o f publ ic ly financed water management systems, including small-scale flood control and drainage schemes, to be retained for local operation and maintenance use. There i s l i t t le consistency in terms o f the local institutional structure put in place to manage the interventions: some use an informal structure while others, in accordance with the Guidelines for Participatory Water Management, use a formal structure with legally registered organizations.

The Service Sectors 21. Irrigation and drainage. The National Water Management Plan suggests that government has a

role to play in the development o f surface water irrigation systems. Large-scale surface water irrigation projects require considerable lead time to move from a concept to the point where they are delivering water to farmers’ fields. Assuming that this lead time i s in the order o f 10 years, and that private sector irrigation expansion using groundwater will provide sufficient production increases to meet the needs o f the expanding population for the next 15 years, there i s a 5-year window during which concrete efforts should be made to improve the performance o f existing schemes. T h i s would include no t only physical rehabilitation but, most importantly, concrete changes in irrigation management approaches and the existing institutional frameworks. The current approach o f the government i s t o mandate that w o r k o n two major irrigation projects

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22.

should b e initiated every year f rom this point forward. To achieve the desired sustainable food production increases, this would need to go hand in hand with a concerted attempt to improve the performance o f existing systems.

Water and sanitation. Bangladesh has made good progress in improving access to safe water and mov ing towards the Mi l lennium Development Goals (MDG). The water supply coverage has increased both in the urban and the rural areas. Nearly 97% o f the rural population i s served by over 10 mi l l ion hand tubewells; however, arsenic contamination o f groundwater above the permissible limit of 50 pg/L (micrograms per liter) in Bangladesh has affected an estimated 25% of the shallow tubewells, reducing safe water coverage in rural areas to around 76%. Current challenges relate to the following: (a) increasing urban demand due to population growth and migration; (b) institutional inefficiency due to lack o f clarity as to roles and responsibilities o f policymakers and service providers; (c) inequitable service distribution, t o which programs have responded by including social awareness to increase the impact o f delivered hardware; (d) arsenic contamination, to which the response i s shifting towards community-based water delivery systems; (e) financing and cost recovery, which i s being addressed by improved service management; and (f) sector coordination, in response to which a National Forum for Water and Sanitation has been established and a new policy support unit i s under discussion.

23. Inland water transport. In promoting development and more efficient utilization o f the sector, a number o f challenges need to be addressed. The navigability o f many o f the rivers i s declining as a result o f a combination o f reduced dry season discharges and siltation in the channels. These problems are exacerbated by the difficulties associated with predicting morphological behavior o f many of the rivers. The response has been less than effective because o f a number o f related difficulties. Poor planning, programming, and management have resulted in inadequate capital funding for necessary interventions to improve navigability. Inadequate recurrent budget allocations have fostered weak management and poor monitoring and control systems leading to l itt le or n o maintenance o f associated physical facilities such as mooring and storage facilities, theft o f navigation aids, lack o f and slow modernization o f country boats, and litt le expansion o f rural launch facilities. The current approach i s one that promotes an agenda for increasing public- private partnership in the sector, improving facilities in the areas o f communication, navigation aids, and smaller landing facilities, as we l l as strengthening service delivery through human resource development.

Fisheries and environment. Aquaculture, in both fresh and brachsh water, has shown annual growth rates exceeding 10% over the past decade. M u c h o f that production i s a result o f utilization o f existing ponds and technologies. But capture fisheries, both inland and marine, are declining and this trend i s l ikely to continue without an infusion o f polit ical will, changes in current policies, improved institutional arrangements, and additional investments. Poor landless sectors o f rural society depend substantially o n the open water capture fisheries and key issues for the sustainable use and preservation o f capture fisheries include maintenance o f dry season flows, protection o f key aquatic habitats, creation and maintenance of fish sanctuaries, l imitation to further disruption of migratory pathways, and avoidance o f further pollution and chemical degradation.

24.

Priorities for World Bank Engagement 25. Managing water resources i s a continuing challenge and opportunity in Bangladesh. Over the past

four decades, government and the private sector have responded to the changing social, economic, and technical environment and these adaptations have contributed to major achievements: increases in cereal production f rom about 7.5 m i l l i on metric tons to more than 25 mi l l ion metric tons annually; inland aquaculture producing an estimated 850,000 metric tons annually, though capture fisheries have declined; provision o f safe drinlung water to more than

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75% o f the rural population and more than 50% o f the urban population; and rural sanitation coverage exceeding 30% in rural areas and 50% in urban areas. Nevertheless, despite the evolution o f policies, programs, and plans that promote increasingly efficient uti l ization of scarce financial resources, remnants o f past approaches focusing o n capital investments and large-scale infrastructure persist. However, just as past actions were not a guide to the fbture in 1971 (when the Bank undertook the Land and Water Sector Resources Study), so it i s to be hoped that future development can separate itself f rom the shortcomings o f the past 30 years.

What follows are medium- to long-term programmatic priorities for W o r l d Bank engagement, outl ining programs rather than specific projects. Whi le the Bank would engage in these issues, they constitute major investment areas and would require jo int efforts with other development partners. The portfolio, summarized in the following table, aims to address:

26.

The institutional framework, including the responsibilities o f different actors; and standards for water quality and service provision (especially for the poor), for the environment, for land use management, and for construction and management o f infrastructure, which affects the quantity and quality o f water resources at various levels.

The management instruments, including regulatory arrangements; financial instruments; standards and plans; mechanisms for effective participation o f stakeholders; and knowledge and information systems that increase transparency, motivate effective water allocation, use, and conservation, and secure maintenance and physical sustainability o f the water resources system.

The development and management of infrastructure, for irrigation, floods, and droughts, and for water quality and source protection.

The political economy of water management and reform, in which there i s particular emphasis on the distribution o f benefits and costs, and o n the incentives that encourage or constrain more productive and sustainable resource use and in which there i s a pragmatic, sequenced and prioritized reform path.

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Dhaka water supply and sanitation program and bulk water system. Dhaka i s expected to become one o f the world’s mega cities, with the population increasing fivefold in the next 50 years f rom nearly 9 m i l l i on in 2000 to 30 mi l l ion in 2025 and 50 m i l l i on by 2050. This growth wil l put immense pressure on a l l public services and infrastructure, but particularly o n the infrastructure needed for a safe and reliable water supply system for a l l inhabitants and for industrial and commercial establishments. The program for Dhaka will require substantial investment in rehabilitation, replacement, improvement, and extension o f the city’s water supply systems to substantially raise service coverage levels by 2010 and sustain them at that level in the future. This will be accomplished through a combination o f public-private sector initiatives to develop major new surface water sources for bulk water supplies, coupled with improvement and expansion o f the main water distribution system based o n existing deep tubewells and new surface water sources. Peri-urban and poor communities will be encouraged and supported to develop and install safe handpumps and small deep tubewell-based systems. A project t o start addressing water supply, sanitation and drainage in Dhaka i s under preparation.

Integrated water management of greater Dhaka region. The rivers in and around Dhaka are heavily polluted. The major source o f this pollution i s domestic and industrial wastewater discharges. Water pollution exacerbates the problem o f water scarcity and inadequate drainage further increases the exposure o f urban populations to the effects o f polluted water. Health surveys show that over 10% o f a l l morbidity in urban areas i s attributable to environmental conditions. The program would build o n the work undertaken as part o f the Dhaka Environment Project carried out under the Bangladesh Environmental Management Project supported by the Canadian International Development Agency (CIDA) and would address a number o f cross-

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cutting themes, including urban, environment, pollution, water supply and sanitation, drainage, and flood control issues, and would provide financing to deal with these in an integrated framework, linking water resources with environmental and water and sanitation service interventions. The program would also support the development o f a pol icy o n urbanization that addresses the uncontrolled growth o f urban centers. There are other major urban centers in Bangladesh that require a similar program and the experience with Dhaka would facilitate an extension to other centers.

Table A. Medium- to Long-Tern Programmatic Areas for Support to Water-Related Activities

Broad interventions wi th Poverty-targeted interventions overall poverty reduction impacts

Interventions affecting water Type I: resources, development and management resources interventions

Broad regionwide water

e Integrated water management o f greater Dhaka region

rationalization o f existing flood controlidrainage

e Rehabilitation and

e Major river studies e River erosion

management e Gorai River restoration e Inland waterways

Interventions affecting service Type 3: sector delivery water and Broad service delivery reforms

Dhaka and Chittagong water supply, sanitation

sanitation, irrigation, inland water transport)

and drainage program

Type 2: Targeted water resources interventions e Wetland and bee1

rehabilitation and management

Type 4: Targeted services e Improved rural, urban,

peri-urban service delivery (including continued support to address arsenic contamination)

irrigation

management of existing surface water irrigation schemes

fisheries

e Expansion o f minor

e Support to improve

e Community-based

29. Chittagong water supply and sanitation. The government has expressed a willingness to see the Bank involved in supporting improvement o f the water supply and sanitation (WSS) service of Chittagong. A project combining the objectives o f integrated water resources management,

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improvement o f the overall performance o f the WSS utility and expansion o f the WSS service, in particular to low-income communities, i s under preparation as a component ,of the Dhaka- Chittagong Water Supply and Sewerage Authorities (WASA) project.

Urban and rural water supply and arsenic mitigation. Arsenic contamination i s threatening to undo past achievements in safe water coverage. Almost without exception, i t i s the poor that suffer most since they have limited resources with which to respond. The arsenic contamination presents an opportunity to rethink the institutions that define the drinkmg water sector and, in particular, t o reexamine the role o f local governments and communities in the delivery o f rural services. In other words arsenic mitigation projects, when integrated within an overall water supply vision, can provide a vehicle for institutional reforms that transform government agencies f rom providers o f services to facilitators assisting local governments to help themselves. W o r l d Bank involvement in arsenic would continue with emphasis o n the following:

0 Establishing innovative institutional arrangements and service delivery systems that clearly define new roles and responsibilities for user communities and local government institutions, bringing them to the forefront o f activities related to planning, implementation, and management o f water services, thereby mainstreaming arsenic considerations into water supply investments and contributing to sustainable investments.

Identifying alternative arsenic-safe sources of, and technologies for, water used for drinkmg and cooking.

Protecting the right o f the poor to access to water supply systems.

Building capacity at the local level t o plan, implement, finance, and manage water supply services.

Supporting the integration o f groundwater management activities with water supply activities.

Wetland and bee1 rehabilitation and management. The availability of dry season water will be the most critical issue facing inland capture fisheries in Bangladesh. I t i s estimated that 50% or more of the perennial wetlands o f Bangladesh have been drained, encroached upon, filled, or otherwise lost in the past 30 to 40 years. T h i s has negatively impacted the poor, fish production, and plant and animal biodiversity, as wel l as a variety o f environmental services that wetlands provide. Programs that focus o n rehabilitation o f formerly perennial wetlands could include reexcavation o f beels (seasonally flooded wetlands) or other water bodies, coupled with reconnection o f those water bodies with rivers and streams and the addition, if required, o f small water control structures. Revegetating riparian corridors and reestablishing wetland forests could be a part o f the program in suitable areas. Excavated areas would preserve fish and fisheries and provide fishing opportunities to the poor. Those areas immediately adjacent t o the wetlands could also provide surface irrigation to farmers in the immediate area and would help in preventing further losses o f khas (publicly owned) and other public water bodies to encroachment. Excavation and engineering would more logically be the responsibility o f local government and those national government agencies concerned with this type o f work. The Department o f Fisheries, operating through NGOs and local government, could be responsible for overseeing the fisheries management aspects, which would include the maintenance o f minimum water levels, development o f community management organizations, development o f fish sanctuaries, closed fishing seasons, and other aspects o f community fisheries management, such as alternative income generation.

Long-term commitment to rehabilitating and rationalizing existing flood control and drainage infrastructure. Rehabilitation and the associated challenge o f sustainability are high on government’s water sector agenda and are reflected in key pol icy documents, including the

30.

0

0

0

0

31.

32.

X


Poverty Reduction Strategy Paper and the National Water Policy. The Bank has supported government in constructing a significant proportion o f the flood control and drainage infrastructure that exists throughout Bangladesh. In some cases, existing infrastructure will need to be abandoned or even destroyed to achieve a rational outcome. Infrastructure interventions also need t o b e coupled with early warning systems and other soft measures to support communities and the ever-burgeoning population to better cope with floods. The Wor ld Bank i s a logical partner for the Government o f Bangladesh, since this i s a complex area where Bangladesh could profit from international experience, and where the Bank’s abil ity t o link across sectors would be an asset. Whi le the rehabilitation and rationalization wil l adopt sound planning and design principles to ensure that technical, social, and environmental considerations are respected, it will also have an overriding focus on developing sustainable systems for operating and maintaining infrastructure, including strengthening the involvement o f local stakeholders and local government institutions in al l stages o f the implementation process. In addition, the rehabilitation design needs to accommodate potential future climate change.

Provide support to policies and programs that expand minor irrigation. The present area irrigated by minor irrigation technologies could be expanded f rom 4.3 mi l l ion ha to as much as 6.7 m i l l i on ha. The Wor ld Bank’s historical involvement with minor irrigation provides it with a strong advantage in dealing with the challenges associated with supporting the sector. The Bank i s also strongly positioned to address the unknowns associated with arsenic entering the food chain because o f the Bank’s ongoing involvement as a key agency in the response to groundwater arsenic in rural domestic water supplies. T o promote policies and programs that expand minor irrigation, simultaneous engagement on a variety o f issues i s required such as subsidies, arsenic, resource availability, conjunctive use, and monitoring, and these need to be woven into an approach that promotes broader economic development; for this the Bank i s uniquely positioned. As defined by the National Water Management Plan, the program would support minor irrigation through improvement of shallow tubewell and deep tubewell diesel engine fuel efficiencies, introduction o f lower-cost pump sets for force-mode tubewells, and improvement o f irrigation distribution to reduce losses in water-short areas.

Assist with studies to better understand the major rivers. Management o f the main rivers, namely the Ganges, Brahmaputra, and Meghna, requires major investments, and studies are proposed that would contribute to a better understanding o f long-term and cost-effective development prospects. T h i s would include establishing a scientific basis for determining environmental flows, reviewing and updating the Brahmaputra River Training Study Master Plan in light o f recent experience, improving the exchange o f information between riparian countries, as wel l as reviewing the potential for, and feasibility of, developing major infrastructure o n these rivers within Bangladesh. In light o f the l imi ted water available in the Ganges River, these studies would also serve to broaden the country’s development perspective to include both the Ganges, Brahmaputra and Meghna basins. There i s a need to continue to facilitate cooperation on these international rivers, t o promote exchanges o f information, t o convene donors associated with these issues, and to maintain a focus o n the sharing o f benefits, which are a l l key elements o f the studies.

Support efforts to manage river erosion. Riverbank erosion and channel instability hampers development since the permanent risk o f erosion prevents long-term planning. Riverbank erosion destroys about 10,000 ha o f land on an annual basis and this has significant economic and social implications. To address this problem, the National Water Policy requires that government undertake surveys and investigations to develop and implement master plans for river training and erosion control works for the preservation o f scarce land and the prevention o f landlessness and pauperization. The Bank has a history o f involvement with erosion protection work along the Brahmaputra fiver, including Sirajgonj town protection, Chandpur town protection, and r iver

33.

34.

35.

x i


bank protection for the Jamuna multipurpose bridge. In addition to a strong knowledge base, the Bank brings with i t the financial resources to address this diff icult issue.

Gorai River Restoration Project. The southwest region i s being affected by a shortage o f fresh water; increase in salinity o f the surface water, groundwater, and soils; deterioration of the Sundarban ecosystems; sedimentation o f the rivers; reduced crop and f i sh production; and reduced navigability. Increasing the dry season discharge o f the Gorai River would increase the volume o f fresh water entering the southwest region and mitigate some o f the adverse impacts. The Government o f the Netherlands and the Bank provided assistance to the Government o f Bangladesh in the late 1990s to determine the feasibility o f dredging the Gorai River f rom i t s offtake at the Ganges to the railway bridge, situated about 16 lulometers (km) downstream. This first stage consisted o f dredging a pi lot channel followed by two consecutive years o f maintenance dredging. Subsequently, this pi lot channel largely inf i l led with sediment (because the associated river training works, which were to be financed by the Bank, were suspended because o f misprocurement issues.) The feasibility study based o n the pi lot dredging concluded that restoration o f the Gorai River offtake was feasible through a combination o f continuous dredging and structures, including a f low divider, t o divert Ganges flows into the Gorai R v e r . The study considered f ive infrastructure options ranging in cost f rom an estimated US$110 mi l l i on to US$198 mill ion.

Inland water transport. Inland waterways are o f importance as a part o f Bangladesh’s integrated transport network. A Policy Note i s currently being prepared for analysis o f h o w the Bank could reengage in this sector.

Table A summarizes these programmatic areas o f support t o the water sector by the Bank f rom the perspective o f the poverty impact o f these interventions. The strategic priorities for W o r l d Bank engagement outlined in the table reflect a long-term vision within a broad intersectoral perspective. They provide a balanced approach to underpinning growth through providing vi ta l broad-based infrastructure and reform, as wel l as targeting the poor at the local level, as also outlined in the PRSP.

36.

37.

38.

xi i

1. Development Context and Introduction

Out look 1.1 The population o f Bangladesh i s forecast to increase f rom about 133 mi l l ion to over 220 m i l l i on

by 2050. Urban centers are expected to absorb most o f the incremental population, growing f rom the present 30 mi l l ion to about 130 mill ion. This population growth combined with economic growth will increasingly stress water resources and this has the potential to be the dominant environmental and possibly the most important development issue facing Bangladesh in the coming h a l f century.

1.2 Significant investments in infrastructure will be required to provide potable water to expanding urban centers. Currently, delivery systems provide about 10,000 mi l l ion liters per day; future demand i s expected to be something over 35,000 mi l l ion liters per day. The problem o f meeting such a demand i s complicated by arsenic contamination, t o which almost ha l f o f the population i s presently exposed at levels exceeding Wor ld Health Organization (WHO) guideline values. Urban and industrial pollution around urban centers i s currently affecting fresh water quality and with expansion o f urban centers, the human excreta load will increase from the present 1,500 metric tons per day to a projected 6,000 metric tons per day, while solid wastes will increase f rom 4,500 to 19,000 metric tons per day.

1.3 T o maintain food security, increases in food production o f about 20 mi l l ion metric tons will be required by 2050; among other technological improvements, this would require increases in irrigated cropped area. However, increased pesticide use associated with more intensive production will continue to degrade fresh water resources since about 15% o f these pesticides are washed from the farmland.

The demand for fish i s expected to increase from the present 2.2 m i l l i on metric tons to something between 5.5 and 8 mi l l ion metric tons by 2025. The incremental production will need to be derived f rom inland aquaculture through some combination o f increasing production per unit area, increasing area under production, and increasing imports. Fish currently provide 65% of the country’s animal protein needs and are a critical source o f essential minerals, vitamins, and fatty acids. The poorest people in Bangladesh depend on fisheries for their livelihoods and their source o f protein, and reduced per capita fish supplies translate into higher prices and reduced access.

1.4

T h e Role of W a t e r 1.5 Water i s instrumental in the performance o f a number o f economic sectors in Bangladesh,

including agnculture, fisheries, industry and commerce, navigation, and health. Agriculture, which accounts for about 19% o f the gross domestic product (GDP), has expanded between 2% and 2.5% per year over the past two decades. T h s growth has been spurred by the elimination of nontariff barriers o n pumps and power tillers and by lower tariffs on inputs. These factors have combined to increase the irrigated area, increase fertilizer use, and promote shifts to modem varieties. The fisheries sector, which accounts for roughly 4% o f GDP, i s the second most important eamer o f foreign exchange. Inland capture fisheries have been declining, in part because dry season aquatic habitat has been reducing in area and degrading in quality, a result o f increasing irrigation abstractions, encroachment, and pollution. Inland and brackish water aquaculture emerged in response to the diminishing supply f rom capture fisheries. Annual growth o f inland aquaculture i s forecast at 5.6% and brackish water aquaculture at 3.2%. Transport accounts for about 8% o f GDP and water transport accounts for about 15% o f total transport GDP. Inland water transport i s generally competitive with other forms o f transport but has been adversely affected by siltation, declining flows, and deteriorating water management infrastructure and has not received financial allocations commensurate with i ts potential.

Chapter 1 : Development Context and Introduction

1.6 Given the dominant role that water plays in the performance o f key economic sectors in Bangladesh, and allowing that economic growth i s the single most important factor influencing poverty, i t follows that water and poverty are closely related.’ Water, as a basic resource, i s instrumental in creating and sustaining employment opportunities; as a corollary, water-related interventions that increase the use o f labor are pro-poor.

Agricultural production, which i s dominated by crops, employs about 63% o f the labor force. Water management infrastructure that reduces risk, and stabilizes or increases agnculture production promotes a willingness to invest, increases economic expectations, and thereby provides opportunities for farmers at a l l levels o f production. The resulting impacts are increased employment and lower food prices, both important tools for poverty reduction since, l i ke the urban poor, many o f the rural poor generate their income f rom employment, and a l l are net food purchasers.*

Fisheries provide 9% o f the country’s employment. Government estimates that over 1 m i l l i on people f i s h full time and another 11 mi l l ion fish professionally on a part-time basis. I t i s estimated that four out o f f ive rural Bangladeshis depend to some extent o n aquatic resources. Poorer landless sectors o f rural society rely on inland capture fisheries and marine capture fisheries for income and for food and are increasingly vulnerable to growing conflicts over control o f these resources. Maintaining present levels o f production and preserving current biodiversity in these habitats should be considered priority objectives if the livelihoods o f the poorest rura l residents o f Bangladesh are to be sustained. The measures include maintenance o f dry season flows, protection o f key aquatic habitats, l imitation to further disruption o f migratory pathways, and avoidance o f pollution and chemical degradation.

Inadequate water and sanitation services have a particularly adverse effect o n the poor, o n their health, and accordingly o n their ability t o contribute to economic development (figure 1). Despite relative improvements in coverage over the past two decades, the absolute number o f people without water and sanitation coverage (generally referred to as the unserved) has increased. Squatters and people in slums have l imi ted access to piped water supply (30%) and sanitary latrines (20%). This lack o f access has significant negative impacts on the urban and rural poor. The urban unserved pay high prices to water vendors for minimal amounts o f water o f dubious quality. Adults and children in both urban and rural areas expend significant amounts o f t ime and energy - which are thereby not available for work, study, and other beneficial and productive activities - collecting and carrying water, suffering themselves and caring for other fami ly members with water-related, mostly diarrheal, diseases. Death and the burden o f water-related disease have led to the loss o f an estimated 5.75 mi l l ion disability-adjusted l i fe years (DALYs).~ Applying a cost o f US$360 per DALY as a l o w boundary estimate, the annual cost o f inadequate

1.7

1.8

1.9

’ Studies have demonstrated a strong association between national per capita income and national poverty indicators such as infant mortality rates, the ratio o f female to male literacy, and average consumption and the incidence o f income poverty (see discussion in World Bank 2000b). This notwithstanding, the evidence suggests that water and sanitation must be available if significant economic growth i s to occur, but their presence does not assure such growth (Vaux 2004). * Recent figures show that over 50% o f a l l m a l households are officially landless and 70% have been identified as “resource poor”. The disability-adjusted l i f e year i s a measure o f effective loss o f l i f e through death and incapacity.

2


Figure 1. Linkages between Poverty and Water and Sanitation

m- w-

lEdwed-dg--bp!Msr tineylentan rrateralackaf

oppocbmfwksinessesrpquiriw-inputs ~ w r p s u n p t i m r i d b . d L i e t Q ~ w ~ FaEtU85

Source: Wor ld Bank 2004.

water and sanitation services i s more than US$2 b i l l i~n .~ The effects o f arsenic contamination add to these estimate^.^

The World Bank The Country Assistance Strategy and this Country Water Resources Assistance Strategy

1.10 The previous Country Assistance Strategy (CAS) operated during W o r l d Bank financial years 2001-2003 (FY01-03). T o help Bangladesh pursue i t s poverty reduction goals during this period, the Bank supported efforts to accelerate private sector-led growth, promote integrated rural development, and consolidate human development gains while emphasizing improvements in governance. The poverty focus was maintained through selected interventions in health, education, rural development, and through improving governance. During much o f this period, CAS lending remained l o w (annual average o f US$300 million) but, simultaneously, nonlending services (analytical work, intensified engagement with c i v i l society, communication campaign) helped the government to prepare the Inter im Poverty Reduction Strategy. The C A S addressed the role o f water through health interventions in water supply and sanitation, and through rural development interventions that operationalized the water pol icy through a National Water Management Plan, restructuring the key water management agency (the Bangladesh Water Development Board; BWDB), decentralizing management o f smaller water schemes, and protecting the rural population, especially the poor, f rom natural disasters.

The new Wor ld Bank strategy i s presented in the forthcoming 2006-2009 C A S which draws o n the 2005 Bangladesh Poverty Reduction Strategy Paper (PRSP). The C A S i s being elaborated jo int ly between the Government o f Bangladesh, the Asian Development Bank (ADB), the United Kingdom Department for International Development (DFID), the Government o f Japan, and the Bank. It will be l inked to the PRSP goals and reform program. During FY06-09 it i s envisaged

1.11

The per capita income o f Bangladesh at US$360 i s used. Other estimates for the value o f a DALY could b e used, such as the annual per capita gross national income, wh ich extends the concept of income more widely than cash receipts. Mos t other values would increase the cost o f a DALY.

About 320,000 children die annually in Bangladesh. Diarrhea accounts for between 50,000 and 100,000 o f these deaths. However, the st i l l unpublished 2003 Bangladesh Health and Injury Survey showed that drowning was the leading cause o f death for children in a l l age categories over 1 year.


1.15

a.

b.

C.

d.

e.

f. g.

Takes into account the relevance o f selected interventions in terms o f the National Water Management Plan and the priorities identified in the plan. The plan presents 84 programs grouped into eight clusters. It places a high priority, and thus recommends an early start on, programs for developing institutions, creating an enabling environment, rationalizing existing flood control drainage schemes and irrigation schemes, and safeguarding the natural environment and aquatic resources. Recognizing that water i s an important vector in influencing human health, the plan also assigns priority t o providing water and sanitation for domestic purposes (including arsenic mitigation). Analyzes the expected impacts o f any Bank engagement in terms o f poverty reduction, as shown in figure 3. It i s expected that, as in other contexts, a combination o f a l l four categories o f intervention will be appropriate and, a priori, that the Bank might provide support t o projects in al l four quadrants. Focuses o n systemic challenges in the country’s water development and management. Seeks to identify initiatives that result in malung things happen o n the ground, recognizing that it i s important to focus o n doing a few things right to demonstrate new approaches that work; therefore, while it i s necessary to be comprehensive, it i s not necessary to be complex. Focuses on sequencing o f interventions, recognizing that such a large task cannot be accomplished everywhere at once - or quickly. Takes into account the comparative advantage o f the Bank. Ensures consistency with ongoing activities in the country, which already define the Bank’s engagement in some areas o f the water sector (such as the National Water Management Improvement Project, the Bangladesh Water Supply Program Project, and so on)

The CWRAS i s not a substitute for in-depth analytical work o n the water-using sectors, nor i s it intended to dismiss the goal o f integrated water management; i t s purpose, rather, i s to define practical, implementable, sequenced, and prioritized actions that provide an entry point for further analytical work and investments.

Box 1. Main Messages of the World Bank’s Water Resources Sector Strategy (2003)

Water resources management and development i s central to sustainable growth and poverty reduction and therefore central t o the mission o f the Bank. Mos t developing countries need to be active in both management and development o f water resources infrastructure. The main management challenge i s establishing a “pragmatic but principled” approach that respects principles o f efficiency, equity, and sustainability, but recognizes that water management i s intensely political. Since most developing countries have inadequate stocks o f hydraulic infrastructure, the Bank needs to assist in developing and maintaining hydraulic infrastructure and in mobilizing public and private financing, whi le meeting environmental and social standards. The Bank will reengage with high-rewardhigh-risk hydraulic infrastructure, using a business model that puts development impact first. The Bank i s perceived by many to have a major competitive advantage in the water sector and there i s accordingly a strong demand for the Bank to engage. The Bank’s water assistance must be tailored to country circumstances and be consistent with the overarching Country Assistance Strategy and the Poverty Reduction Strategy Paper.

5

2. Objectives of this Country Water Resources Assistance Strategy

2.1 Bangladesh i s a country o f contradictions. At independence in 1971, Bangladesh was greeted with predictions o f dire and total societal failure (Kissinger’s memorable “the basket case of the world”). Y e t since independence Bangladesh has made astonishing welfare advancements. T h i s includes major strides in developing export-related industries, achievement o f food self- sufficiency, and an underpinning by sound macroeconomic policies. Average GDP growth rate in recent years remains at around 5% and reached 5.3% in FY04 - in spite o f the 2004 floods. The poverty reduction trend, which accelerated in the 1990s, has continued and the government i s setting ambitious goals for poverty reduction in i t s PRSP process.

2.2 Achievements in human development results, such as reductions in chi ld malnutrition and maternal mortality and an increase in net primary school enrollment, have been greater than income poverty reduction, and impressive in relation to countries o f similar income level. In fact, Bangladesh has already made good progress towards the Millennium Development Goal (MDG) of providing universal education.

All o f this has been achieved in the face o f assessments by donors and international finance institutions that Bangladesh suffers f rom a lack o f absorptive capacity, that government frequently lacks ownership o f development programs, and especially that l ine agencies suffer f rom weak (project) implementation capacity. The latter assessment has conditioned the Bank’s declining involvement in the infrastructure sector, including water, in recent years. A further challenge i s related to overall weak governance and corruption.

Thus, by reengaging in the water sector, the Bank recognizes that whi le framework conditions could ideally be better, progress has been made in past decades and the Bank i s willing to develop options to support further progress. T h i s operationalizes an approach o f “principled pragmatism”, which seeks to promote good practice in areas where best practice might no t always be possible; in other words, not malung the best the enemy o f the good. In this context, a number o f the major - water-related - drivers for growth and economic development in past decades in Bangladesh need to be highlighted. They include:

0

2.3

2.4

Substantial increases in dry season productivity, largely through tubewell irrigation.

Successful reduction in the impact o f disasters through community involvement in planning and risk management.

Some successes (and some failures) in large irrigation and f lood control projects.

Great resilience in dealing with recurring floods.

Greatly improved access to bacteriologically safe drinlung water in the rural areas over past decades due to major private household investments in shallow tubewells, though this has been compromised by the arsenic issue.

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2.5 For most o f Bangladesh’s independence, the Bank has been a - even the - central partner to the government in the water business. I t i s thus regrettable that for a number o f ye,ars fo l lowing the late 1990s governance issues caused the Bank to withdraw support f rom the water sector in Bangladesh. The Bangladesh Water Supply Program Project was approved in June 2004, and two projects, related to water, sanitation and drainage in Dhaka, and to the water resource- environment nexus around Dhaka, respectively, are under preparation.. In addition, further activities towards flood management, responding to the severe flooding events o f 2004, are under way. No other water-related projects have been approved since 1999. The Bank i s n o w committed to reengage as an active partner in the water sector in Bangladesh. In developing this

Chapter 2: The Objectives o f This Country Water Resources Assistance Strategy

reengagement further, the Bank i s building on the enormous stock o f excellent pr ior analytic work, and on the lessons learned (both o f success, and o f failure).

The CWRAS is an attempt - in a quick and nimble manner - to summarize the lessons, t o assess the comparative advantage o f the Bank, and to formulate a set o f rules o f engagement so that water development and management continues as a driver o f social welfare in Bangladesh. I t s objective i s thus to contribute to a strategic reengagement o f the Bank in supporting the Government o f Bangladesh in i t s activities in the water sector.

The a im o f the CWRAS i s to underpin such a strategic approach by:

0

2.6

2.7

Engaging with a variety o f stakeholders (including pertinent government ministries, NGOs, other development partners, the private sector, and research institutes); specifically, soliciting input f rom all, forging consensus to the extent possible, but with n o il lusion that consensus o n a l l issues i s either possible or desirable.

Building on, and not replicating, the large amount o f analytic work that has been carried out in the country, going back to the land and water studies o f the 1970s through the F lood Act ion Plan and most recently the National Water Management Plan.

Ma lung use o f local expertise.

Ensuring that discussions reflected the content o f and contributed to the development o f the PRSP and the new CAS.

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8

3. Water and Sustainable Poverty Reduction in Bangladesh

The Water System The Land and Water Resource Base

3.1 Bangladesh has a total area o f about 14.7 mi l l ion hectares (ha) and a net cultivable area o f about 8 m i l l i on ha. The two primary sources of water are local rainfall amounting to about 250 cubic kilometers (la3) annually, fall ing mainly between July and October; and transboundary inf lows amounting to about 1,000 h3 annually, derived mainly f rom the Brahmaputra, Meghna, and Ganges Rivers, with greatest f low occurring also between July and October. Bangladesh occupies only 8% o f the total area o f these rivers’ three basins but i s the point o f concentration o f their catchments. The result i s a huge excess o f surface water during the summer months and water shortfalls in the winter months. Consequently, the minimum flows required to meet total demands are less than what i s available f rom surface and groundwater in the southwest and north-central regions o f the country. (This analysis assumes that arsenic contamination does not significantly compromise the suitability o f groundwater for imgation.)

Location Matters

3.2 Bangladesh i s the lower riparian o f the Ganges, Brahmaputra, and Meghna Rivers, occupying only 8% o f the total area o f the three basins, and i s the point o f concentration o f the runof f generated in the upper catchments in the Himalayas (figure 4). Continuing changes in the upper catchment, which include deforestation in the Himalayas, land degradation, and landslides, and development in the middle catchment in the fo rm o f f lood control infrastructure, combine to increase the flood peaks and sediment loads within Bangladesh and exacerbate the disadvantages o f being the lower riparian. Whi le some developments in the upper catchment tend to aggravate f lood problems, water shortages in Bangladesh during the dry season, between January and March, are worsened by other developments such as upstream water diversions and withdrawals.

The National Water Policy acknowledges that Bangladesh, as the lower riparian, has l imi ted control over the rivers entering i t s borders. In particular, Bangladesh i s affected by the significant upstream diversions and abstractions that reduce water availability during the dry winter months, by the absence o f upstream hydrometric data that inhibits responses in periods o f both flood and drought, and by the general poor quality o f water entering the country f rom upstream in some o f the basins. The National Water Policy further recognizes that the situation i s progressively becoming worse as population densities and economic activity are increasing, and water quality i s deteriorating. The net result i s that per capita supply o f renewable water i s declining throughout the basins that Bangladesh shares with India. Reduced water availability in the Ganges dependent area has affected the southwest region o f Bangladesh in a number o f ways, including increased saline intrusion, changes to r iver morphology, and increased environmental hazards, threatening the security o f the natural aquatic resources.

3.3

Chapter 3: Water and Sustainable Poverty Reduction in Bangladesh

undertake an objective assessment o f where there might be commonality o f interest with India. T h i s could include dry season augmentation in the Ganges, and controlled flooding and enhanced dry season water availability in a variety o f other shared rivers. Bangladesh then also needs to bring proposals to the table that identify areas to which it can contribute. Whi le the W o r l d Bank’s role as an impartial international arbiter i s negligible unless al l riparians ask it to act, the Bank can assist in identifying common interests and help to build o n these.

Climate Change and Adaptation Needs

3.6

3.7

3.8

3.9

Bangladesh i s generally considered to be vulnerable to changes in climate because it has a high population density, i s located on a low-lying delta, and i s subject to heavy rainfall and in f lows o f large volumes o f transboundary surface water confined to a relatively short monsoon season. A possible scenario for climate change would have temperatures rising by up to one degree Celsius, monsoon precipitation increasing by as much as lo%, dry season precipitation reduced, and sea level rising by 30 centimeters or more. These changes would have several critical impacts:

a.

b.

C.

The combination o f reduced winter season precipitation and increased temperatures, resulting in higher evapotranspiration rates, wil l reduce winter r iver flows. In addition to reducing the fi-esh water available for an expanding population, this could result in saline water intruding further inland along coastal areas, affecting natural ecosystems (mangrove forests) as w e l l as food production systems. A further l ikely impact i s that the sediment transport characteristics of the r iver systems would be altered. Increased precipitation during the monsoon season will increase r iver discharges and probably increase flooding in some areas o f the country. T h i s may wel l result in restoring some o f the seasonally flooded wetlands areas (beels) that were lost to drainage, and y ie ld some benefits t o fisheries and winter season agriculture. However, adverse impacts could include increased r iver erosion and poor drainage o f agricultural lands. A sea level rise will exacerbate drainage problems in the coastal zone, which has been largely protected from flooding by embankments. This will occur in two ways. Firstly, existing infrastructure (embankments and drainage regulators) was designed for historical water levels and tidal fluctuations. A sea level increase would reduce the tidal range within which outf low occurs, decreasing the total discharge during each cycle. Secondly, t idal meeting points will migrate further inland. These locations, where sediment deposition occurs, will impede upstream drainage and change drainage characteristics of the region.

Adaptation requirements were defined in some detail in an earlier Wor ld Bank study in terms o f the most vulnerable impact categories for climate change, namely coastal resources, fi-esh water resources, agnculture, human health, ecosystems, and biodiversity (World Bank 2000a). An adaptation measure identified as common to a l l was the need to incorporate climate change in long-term planning. Importantly, i t was noted that learning to better deal with existing climatic variations constitutes one o f the best preparations for dealing with climate change. Specifically, this comprises improving construction quality, and strengthening operation and maintenance o f existing systems.

Climate change i s expected to have a broad range o f impacts, and sustaining development over the long term in Bangladesh will require adapting to them. Climate change i s expected to have extensive impacts o n the land-water system, and a better understanding o f these impacts should be promoted and plans for addressing them should be prepared and implemented. There i s an opportunity for expected climate change impacts to be taken into account proactively in the planning and design o f existing water resources infrastructure rehabilitation, given that much o f this infrastructure has already exceeded i ts design l i f e span.

Bangladesh will be further impacted by climate change that occurs in the upper basins in India. Under a changed climatic regime for any given region, the combined effect o f lower rainfal l and

11


more evaporation would lead to less runoff, substantially changing the availability o f fresh water in the watersheds. An assessment o f the implications o f climate change for hydrological regimes and water resources using scenarios developed from Hadley Centre Mode l Simulations indicates that, by the year 2050, the average annual runof f in the River Brahmaputra will decline by 14%. Studies have indicated that the impact o f snow melting in the high Himalayas will lead to f lood disasters in Himalayan catchments. Impacts will be observed more in the western Himalayas, as the contribution o f snow to the runof f o f major rivers on the western side i s about 60% compared to 10% on the eastern side (IPCC 2001). Singh (1998) suggests that an increase in surface temperatures will lead to a rise in the snowline, increasing the risk o f floods in north India during the wet season.’

Water Development and Management and Poverty The Land and Water Strategy of 1972: Setting a New Course

3.10 The 1964 Water Master Plan, prepared by the East Pakistan Water and Power Development Author i ty (EPWAPDA) with assistance f rom the United States Agency for International Development (USAID), focused on increasing agriculture production mainly through extensive f lood control embankments combined with structures to facilitate drainage in the short run and public-financed medium- to large-scale irrigation in the longer run. T h i s p lan was prepared for a nation o f fewer than 60 mi l l ion people o f whom more than 90% l ived in rural areas producing mainly rain-fed rice with relatively rudimentary technologies. The plan did not reflect input f rom local stakeholders, since sustainability and related operation and maintenance issues were not addressed, nor did it consider intersectoral problems since the flood plain was extensive, fish were abundant, the road network was limited, and there were virtually n o water-polluting industries. Also, the priority was to increase rice production. The plan was therefore highly prescriptive and focused o n restricting flood waters to prescribed avenues through a clearly defined system o f embankments designed to prevent flooding o f agriculture lands and ignored the effects o f drought on the production system. T h i s approach was firmly embraced by most engineers within EPWAPDA and by i t s successor, the Bangladesh Water Development Board (BWDB).

The 1972 Land and Water Resources Sector Study identified the inherent problem o f l imi ted cultivable land, subjected annually to drought as wel l as to severe flooding and to periodic cyclone damage, and noted that these problems were being exacerbated by population pressures o f mounting intensity. T o increase food production rapidly enough to avoid unmanageable imports and to provide useful employment in rural areas, the study proposed a series o f quick- yelding, low-cost, labor-intensive projects, whi le at the same time planning for long-run programs. The following key inputs were emphasized: (a) high-yielding seed production and distribution; (b) input packages comprising seeds, fertilizer, plant protection, and improved draft power; (c) low-lift pump irrigation and small drainage improvements; (d) minor to medium-size drainage works; (e) tubewell irrigation; and ( f ) early investigation o f increasingly more di f f icul t and major drainage works, including polders in deeply flooded areas for f lood protection and irrigated agnculture. Implementation capacity was highlighted as an area o f concern. The study further recommended that since the delta lends itself t o scattered developments not requiring large indivisible investments, the rural works type o f approach could be applied if backed up with adequate engineering, but regional master plans needed to be prepared without delay (Wor ld Bank 1972).

The 1972 study resulted in a shift to financing o f small- and medium-scale f lood control, drainage, and irrigation projects by most donors, including the Government o f the Netherlands,

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http://www.teriin.org/climate/impacts.htm.

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which led the way with i t s Early Implementation Projects; the Wor ld Bank in partnership with the Canadian Government, which modeled a series o f small-scale water resources development projects o n the Early Implementation Project experience; and the Asian Development Bank (ADB), which invested in small- to medium-scale projects. At the same time, a series o f changes were made to improve the availability o f agriculture inputs, and agnculture extension services were restructured and improved. Possibly the most important change in terms o f increasing food production was that the government and the donors agreed o n policies promoting the expansion of imgat ion f rom groundwater using tubewells provided by the private sector. As a result, groundwater irrigates about 90% o f the 4.5 mi l l ion ha currently under irrigation.

The 1972 study also identified the urgent need for regional master plans to ensure that water management infrastructure was planned and constructed in a rational manner. These plans were not prepared as part o f the 1987 National Water Policy and detailed in the regional studies sponsored by the Flood Act ion Plan. Nevertheless, the 1964 Water Master Plan provided de facto

3.13

guidance to- the BWDB in identifying and planning small and medium flood control interventions. Recently the ADB, in accordance with the mandate provided by the National Water Policy, has been supporting preparation o f district-level water resources assessments through two projects.* The preparation o f these district-level studies i s being coordinated through the Water Resources Planning Organization (WARPO) and includes representation f rom several agencies, including the BWDB.

Natural Hazards, Vulnerability, and the Poor

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Bangladesh i s subjected to water-related hazards such as cyclones, storm surges, droughts, floods, and r iver erosion. In theory these hazards affect everyone, but in practice the poor are most affected. The poor outnumber the r i ch (53% o f the rural population are classified as poor with 37% classified as very poor), they l ive in greater density (at least 900 personsh’) , they occupy the most poor ly constructed housing o n settlements located o n lands prone to hazards, and they do not have the resources to endure natural hazards without assi~tance.~

Between 1970 and 1998, 17 1 large-scale disasters were recorded in Bangladesh. T h i s translates into an annual disaster frequency o f 6.11, making Bangladesh the most disaster prone of a l l countries.’o These disasters lu l led an estimated ha l f m i l l i on people and affected more than 400 mi l l ion (UNDP 2001). Tropical

Figure 5. Impacts o f Large-Scale Disasters in Bangladesh

Peoplo.%ffecled by D i w r t e r s

Drolkghtrr

People Killed by Di?a,sterr

Fbulr , Mn-water rdaiuI

* The second Small-Scale Water Resources Development Sector Project (2002-2009), under the LGED, i s t o prepare water resource assessments for 56 districts, and the Project Preparation Technical Assistance (PPTA) Team for the Southwest Regional Project (2003-2004) i s t o prepare plans for 5 districts. Water resource assessment plans for the 3 hill districts have not been assigned.

A disaster i s the result o f a hazard’s impact o n society. The extent o f a disaster i s therefore determined by a community’s vulnerability t o the hazard. lo Afghanistan, with an annual frequency o f 1.79 large-scale disasters, i s the next most disaster prone.


cyclones were responsible for the largest number o f deaths, primarily in the coastal areas, whi le floods affected the greatest number o f people (figure 5). Even when the frequency o f dramatic natural events does not increase, the increase in population density and in poverty, and the growing scarcity o f resources, heighten the magnitude o f the impact.

Erosion and channel instability have caused significant damage to human settlements and infrastructure. This i s because most o f the rivers f l ow through typically unconsolidated sediments of the Ganges-Brahmaputra-Meghna flood plain and delta, which i s susceptible to r iver erosion from channel migration, river widening, and the formation o f avulsions (box 2). Expansion i s taking place primarily through the destruction o f f lood plain land and the creation and destruction o f short-lived, low-lying chars (depositional islands). Riverbank erosion and channel instability hampers development since the permanent r i s k o f erosion prevents long-term planning. Social impacts o f erosion include increased impoverishment as thousands o f individuals and families lose their land, their income, their security, and finally are completely displaced.

The Brahmaputra-Jamuna River alone has increased in width f rom an average o f 8.3 km in 1973 to 11.8 km in 2000. This represents a total loss o f approximately 55,000 ha o f flood plain land in Bangladesh.”

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1 Box 2. Instability and Erosion in the Brahmaputra-Jamuna River System

The erosion problem will continue and, in places, wi l l become more severe than that currently experienced. Most recent research indicates that the channel instability and widening observed in the Brahmaputra-Jamuna can be related to the 1953 Assam earthquake, as a result o f which a sediment wave i s traveling down the Brahmaputra-Jamuna, Padma, and lower Meghna River system. There i s increased instability at th’e wave’s peak followed by more moderate conditions in i t s aftermath. I t i s predicted that the rate at which the Brahmaputra-Jamuna instability increases will slow down, but that the Padma wil l experience increased instability and i s expected to increase in width during the coming years as the peak o f the sediment wave passes through. T h i s wil l then be fol lowed by increased instability and increasing width in the lower Meghna.

3.18 Efforts to control bank erosion and to stabilize f lood plain land have been carried out for more than a century in the area o f Bangladesh. A major problem i s scouring or undermining o f protective works caused by constantly shifting angles o f r iver attack, wh ich commonly destroys bank protection facilities soon after construction i s complete. The rapidly changing r iver planform, even during a normal flood, can result in very unfavorable morphological conditions and requires a new design approach. There are only a few examples o f structures that have proven sufficiently resistant to major bank erosion. All were constructed during the last decade and include the protection work at the Jamuna Bridge, constructed at a cost o f about US$50 m i l l i on per km, Sirajganj town protection constructed for about US$30 m i l l i o n per km; and test revetments constructed at Bahadurabad for about US$lO m i l l i on per km. Only the r iver bank protection at Jamuna Bridge has been without any reports o f failure to date. None o f these solutions i s suitably cost effective for large-scale replication along dominantly rural areas.

In an effort t o reduce the unit cost o f providing reliable r iver erosion protection, short heavily reinforced structures separated by long unprotected reaches have been constructed. This “hard point” approach has certain vulnerabilities. Massive bank erosion can occur between the structures, leading to a requirement to acquire land and resettle inhabitants. If any single structure

Th is is based o n a systematic analysis o f satellite images for the last 30 years to assess r iver changes and flood

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p la in erosiodaccretion (EGIS 1997; updated in EGIS 2000).

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in a series fails, a major part o f the protection i s at stake. Current bank protection concepts acknowledge the need to protect longer reaches with lower-cost systems.

Substantial areas of Bangladesh are flooded annually and the rural economy has adapted to normal flooding, but severe flooding causes hardship. In addition to affecting crop production, i t has direct impacts on household food security and thus food consumption, on the labor market, including female rural employment, and on the livability o f homestead settlements (del Nino and Roy 1999).

Generally, floods result from high flows in the transboundary rivers, internal rainfall, and the l ow level of the country. Synchronization o f peak flows from the major r ivers with spring tides in the Bay o f Bengal or with cyclonic surges can combine to worsen the flood situation. Flood impacts are dictated by any o f the following: (a) flood timing, since crops can withstand more flooding at some stages than at others; (b) flood duration, since damage to crops and other agriculture-related processes occur after submergence tolerances have been exceeded; and (c) flood depth, which determines the areas impacted by different amounts o f flooding.

To reduce flood-related constraints on agricultural production, the BWDB has provided some form o f flood control and drainage (FCD) facilities to 5.18 mil l ion ha (60% o f the country’s net cultivable area), in 464 projects. Of this area, 1.16 mil l ion ha (22%) comprises the coastal embankments and polders, 0.26 mil l ion ha (5%) consists o f partial flood protection (submersible embankments), and 0.7 mill ion ha (15%) provides FCD with a significant irrigation component (FCDI). FCDBCDI projects account for 2.01 mil l ion ha (Halcrow and others 2000).

A number o f studies on the impacts o f FCD investments raised uncertainties as to the net impact on agriculture production during the kharif I1 season (July to October). A 1998 study by the Bangladesh University o f Engineering and Technology (BUET) determined that there was little correlation at the greater district level between the percentage increase in FCD protected areas and the percentage change in kharif 11 production. Prior to that, the Flood Action Plan 12 evaluation carried out in 1991-92 found that 13 o f the 17 projects evaluated had resulted in higher water levels outside the project areas, and a 1990-91 evaluation by the Master Planning Organization o f eight projects reported that al l eight had increased external flooding intensities. This outcome was corroborated by the modeling work carried out for the Compartmentalization Pilot Project where water levels decreased inside the project but increased outside. I t has also become apparent that embankments and regulators prevent fish from migrating to and from spawning and feeding grounds and that this infrastructure has played a significant role in the decline o f the open water fishery and in the reduction o f biodiversity.

Are floods in the Ganges, Meghna, and Brahmaputra basins getting worse? Available information indicates that in recent years flood damage in Nepal, India, and Bangladesh i s increasing and these increases have been attributed to worsening flood events (figure 6).” However, analysis o f available data by Mirza and others (2001) provides no conclusive evidence that peak discharges or flooded areas in Bangladesh have changed over time. Increasing damage i s considered the likely outcome o f rising populations on the flood plain combined with associated growing economic activities, including intensification o f agriculture and better infrastructure (Mirza and others 2001). The total estimates o f asset and output loss due to the recent 2004 floods amount to US$2.3 billion, or 4% o f GDP, though this estimate did not take account o f improved post flood season production.

While flooding has had a smaller-than-expected impact on the national economy o f Bangladesh, and at a regional level flood impacts have a strong element o f uncertainty, flooding impacts

l2 Nepal flood damage i s reported in ADB 1991. Between the 1950s and 198Os, flood damage in India increased by a factor o f 40 (CSE 1992). Bangladesh damage increases are reported in Mirza 1991.

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strongly o n the p00r.l~ Some better-off households are able to absorb the shock o f flooding, but for most i t accelerates a downward spiral into poverty, as assets are destroyed by the floods or sold o f f to support daily needs. In a study o f three communities after the 1998 flood, the percentage of people classified as r i ch declined within a l l three communities, whi le the proportion o f people in the categories o f “helpless’’ and “destitute” poor increased (table 1).

Table 1. People’s Own Perception o f Status in Three Ulipur Villages before and after 1998 Floods

Hatya Saluandamar Hat Aminpara

1999 (%) Before Before Wellbeing categorya Before flood (%) flood (%) lgg9 PA) flood (“A)

Rich 24 5 2 1 31 25

Social poor 43 27 10 15

Helpless poor 10 19 98 87 45 35

Destitute poor 21 40 10 15 25

Beggars 2 9

.. Zero or insignificant. a. Definitions used: Social poor are defined as those who can turn to the community, including moneylenders, in times o f need. Helpless poor are those who are largely landless, and earn their living from wage labor and sharecropping. Destitute poor describes households, usually headed by women or elderly men, that have no income-earning members; disabled people are also among this group. Members o f destitute poor households often starve. Source: Naryan and Petesch 2002.

Figure 6. Bangladesh F lood Damage

Sources: Mirza 1991; A D R C 2000.

l3 Recurrent flooding has been cited as one o f six leading sources o f vulnerability for poor people in Bangladesh; flooding drives even middle-income households into destitution (Naryan and Petesch 2002, p. 530).

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Meaningful Stakeholder Participation

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In preparing the Flood Act ion Plan, partly because o f the poor results o f project evaluation studies and partly because of pressure f rom donors and NGOs, the government accepted that’ for investments in water management infrastructure to be effective, local stakeholders and professionals would need to work side by side as partners at a l l stages o f project planning and implementation. In response, a Guideline for People’s Participation was prepared. This guideline fe l l far short of prescribing meaningful interaction between local stakeholders and professionals and, as the Bank-supported Systems Rehabilitation Project illustrated, methods and relationships needed to be more clearly and explicit ly defined and the local stakeholders needed to be identified more broadly than just beneficiary farmers. In response, the Guidelines for Participatory Water Management were prepared in 2000 by an interagency task force comprising membership f rom the BWDB, LGED, Ministry o f Livestock, Ministry o f Fisheries, and Department o f Agriculture Extension.

Whi le the Guidelines for Participatory Water Management constitute an excellent starting point for promoting local stakeholder involvement in water management infrastructure, they fa l l short o f promoting meaningful participation. Rather than establishing mechanisms to improve agencies’ abil ity to respond to local stakeholders, the guidelines approach the participation issue from the perspective of devising mechanisms and procedures to encourage local stakeholders to participate in achieving the objectives o f the executing agency.

There i s a strong case for government involvement in the development and management o f water resources. A certain amount o f water for drinlung and domestic purposes i s considered a human right, obliging government to ensure i t s availability to citizens. Investments in major water infrastructure tend to b e lumpy and beyond the capacity o f private investors. Water development and use can impose significant externalities o n other users, through changing f lood characteristics, availability, or quality. Surface water resources such as rivers, beels, and haors (flooded tectonic depressions) are generally common property resources, accessible to a broad range o f users (bjsberman 2004). The challenge in Bangladesh i s to establish planning and management systems appropriate to a decentralized c i v i l administration, including devolution o f responsibilities to c i v i l society.

The various categories of water resources interventions generally require a diverse range o f unique institutional structures to support participatory management. These categories mainly include large-scale f lood control and drainage schemes, large-scale public irrigation (which may include flood control and drainage), medium- and small-scale water management interventions, and water supply and ani it at ion.'^ Based on conventional wisdom and experience f rom past practice, a few institutional models are being tested that have the potential to achieve the dual objectives of establishing acceptable and sustainable institutional frameworks, and successful and sustainable cost recovery.

Large-scale flood control and drainage schemes. There are n o adequate existing institutional models within Bangladesh for managing large-scale f lood control and drainage schemes. Several potential models have been identified. These include the reorientation o f the BWDB with regard to its structure and staffing in order to better implement the National Water Policy, which i s specifically geared towards participatory management by beneficiaries and local government institutions.

l4 Large-scale interventions are those impacting more than 5,000 ha.

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3.3 1 Large-scale irrigation schemes. There are several existing institutional models within Bangladesh for large-scale irrigation schemes. The BWDB could retain control o f such systems down to the tertiary outlets while worlung with registered user groups, organized in several tiers under the cooperative system, which collect water charges and participate in overall scheme management and operation and maintenan~e. '~ Alternatively, schemes could be managed through an authorityI6 or control could be transferred to a privatized operator who sells water o n a pay-as- you-use system."

Small- and medium-scale water resources schemes. Currently the best institutional model for schemes o f this type appears to be the ADB-financed Small-Scale Water Resources Development Sector Project. The project reports that the f i r s t 74 subprojects completed (with currently six years o f record) have, over this period, increased their capital funds (shares and savings) f rom US$13,000 in the f irst year to about US$130,000 at present (ADB-GoN-GOB 2005). T h i s i s a strong indicator o f institutional activity since usually shares are sold and savings collected at meetings o f the membership, The full contingent o f 280 completed subprojects also reported more than U S $ l mi l l ion disbursed in microcredit, the funds originating with the membership.I8 Finally, actual expenditures in FY04 for operation and maintenance was about US$38,000 o f the memberships' own fund for 25 8 subproject^.'^ This project relies heavily on local stakeholders' initiative to identify interventions, to rat i fy engineering designs, to demonstrate commitment to operating and maintaining the infrastructure by contributing a specified amount o f funds in advance o f physical construction, and to s ign postconstruction lease agreements for managing, operating, and maintaining the infrastructure?' However, even this approach may not go far enough in terms o f empowering local stakeholders in dealing with local water management issues.

Water management investments, particularly those addressing localized problems, need to be local stakeholder dnven. T o achieve this end requires that financial responsibility, decisionmaking authority, and accountability be devolved to local stakeholders and to their representatives - i.e. the local government. Investments need to be structured such that service agencies are placed in a position that obligates them to respond to the requirements o f these groups, the end users of the infrastructure. This implies that new approaches to financing and implementing investments in construction o f infrastructure need to be developed. To the extent that this can be accomplished with effect, it will promote better construction quality and increased transparency, an outcome o f the latter being reduced corruption.

The case for empowering local government and local stakeholder involvement in managing developing, owning, operating, and maintaining water management infrastructure i s strong. Past practice, consisting o f l imited local government and local stakeholder participation, demonstrated a l o w level o f sustainability and greater participation i s advocated by the National Water Policy,

.

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l5 Schemes operating under this model are being supported by the ADB. They include the Meghna-Dhonagoda Project and the Pabna Irrigation Project. l6 Barind Multipurpose Development Authority.

l8 The system for disbursing microcredit i s highly variable f rom one group to the next. However, these programs do have a number o f common features. In al l cases, loan amounts have been modest and thus o f interest to only those with few assets. The borrowers are individuals known to the water management cooperative associations (WMCAs), the funds belong to the WMCA, and thus the collection rates are relatively hgh . Finally, credit i s mainly issued for economically productive (income-generating) activities, which further ensures repayment. l9 The amount per subproject i s still relatively low at US$138, but the trend i s upwards. 2o T h i s project i s implemented by the LGED with support from the ADB and the Government o f the Netherlands.

Thakurgaon Imgation Project.

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mandated by the Local Government Ordinance, and promoted by the Poverty Reduction Strategy Paper. The means are more intractable.

Decentralization and devolution o f authority requires local government to b e elected at several levels (union, upazila, and zila parishad) and provided with adequate financial and administrative powers to carry out their respective mandates. At present, elected representation exists at the union parishad (which, as o f 2004-2005, receives direct ADP B lock Grant transfers). With the enactment (February 2003) o f the Gram Sarkar (village government) Act, government has in place a program to form 40,000 gram sarkars. However, these are not intended to be a separate tier in the local government but rather a component part o f the union parishad, which will provide them with their budget. The Upazila Parishad Ac t remains in place and i s the basis for elected representation at this tier o f local government. However, n o decision has been taken as to whether this A c t will be implemented or abandoned. There are strong demands f rom c i v i l society to establish a n elected union parishad.

Whatever the outcome o f government’s process and decisions regarding the establishment o f representative and accountable multitier democratic local government, i t i s in the interests o f achieving more effective water management to shift responsibility to existing local government institutions as far as practicable. Ideally, the end result would be financing arrangements whereby local government institutions would access funding for small- and medium-scale water management infrastructure on the basis o f predetermined conditions and criteria. These funds would in turn be used to contract the services required to plan, design, and implement water management interventions f rom either the public or the private sector. Obviously, the scale o f these interventions would need to be consistent with the jurisdiction o f the local government institution involved. A shift in this direction will require strengthening local government institutions.

Water supply and sanitation. Current thinking i s that arrangements will evolve from a heavy reliance o n the public sector in the short run to a gradual but steady transition to increased private sector participation. To promote effectiveness o f the public sector in the short run, emphasis must be placed o n greater autonomy, better management, broader service coverage, and at least operation and maintenance and a part o f the replacement costs. To effect these changes wil l require organizational reform. The evolving role o f the private sector i s expected to include contract services (operation and maintenance o f selected facilities, revenue billing and collection, and so on), build-operate-transfer (BOT) and build-own-operate-transfer (BOOT) schemes to provide bulk water supply and water treatment, and, in partnership with local communities, playing a leading role in the development and operation o f peri-urban water supply schemes. To enhance delivery o f water supply and sanitation services in peri-urban and disadvantaged areas and to meet the needs o f the unserved, NGOs and community-based organizations will be encouraged to participate with the support o f investment funds f rom government.

Because o f the significant contribution that water supply and sanitation services make to both quality o f l i f e and to productive purposes, government must ensure that the provision o f these services i s held to a high standard. To do so, the government plans to establish an appropriate, independent regulatory framework to supervise and monitor public as we l l as private sector performance.

Sustainability: Operation and Maintenance

3.39 Success has been elusive in the many attempts to achieve effective long-term operation and maintenance o f f lood control and drainage interventions. Among the many reasons commonly cited are insufficient funding, institutions that are not appropriately equipped to cany out these tasks, l o w priority, and the absence o f local stakeholder involvement. Whi le these reasons are

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valid, they al l reflect a project culture that has evolved in implementing water resource interventions.

Mos t public sector investment in the water sector has been provided through (relatively) short- term projects with donor support provided through centralized executing agencies. Donor support to the sector has at best been sporadic, more often as not responding to priorities o f their own constituents rather than providing consistent and long-term commitments to the sector. The government, burdened with the responsibility o f providing counterpart financing for the implementation of these projects, under significant time pressure to implement sometimes unrealistic schedules, and unable to predict what priorities the donor community would next assume, has been poorly positioned to manage long-term operation and maintenance o f public sector-financed water management interventions. The result has been that operation and maintenance, too, have become financed as a project rather than an indigenous (albeit with donor assistance) program o f the government.

The National Water Policy position o n financing operation and maintenance o f f lood control and drainage i s subject to interpretation since it appears to contain contradictory statements?l The National Water Management Plan interprets the policy to mean that operation and maintenance costs are not to be recovered o n existing schemes that remain under BWDB control, whereas when management and/or ownership i s transferred, the operation and maintenance costs are also transferred to the recipient entity. T h i s position would seem to be sensible since depending entirely o n government budget resources to finance operation and maintenance o f the entire spectrum o f f lood control and drainage infrastructure i s not plausible.

To facilitate financing and more effective operation and maintenance o f water management infrastructure, consideration needs to be given to classifying infrastructure in to two main categories: that which serves the national common good and that which i s local infrastructure. Infrastructure designated as serving the common good would remain under the control o f the BWDB with rehabilitation, operation, and maintenance financed entirely by government. Rehabilitation of infrastructure designated as local would require a significant pr ior financial commitment from local stakeholders for long-term operation and maintenance, and to the extent practicable would be implemented through or by local government.

In practice, this approach could mean that even relatively small interventions o f say less than 5,000 ha could be delineated in this way with the major infrastructure, for example peripheral embankments and major regulator(s), designated as serving the common good; whereas developments associated with the subbasins, whether channel reexcavation, the provision o f flushing facilities, or other, would be initiated by local stakeholders and require strong input f rom local government and the other stakeholders. T h i s approach constitutes an extension o f the system already adopted under the Small-scale Water Resources Development Sector Project whereby

’’ With regard to operation and maintenance (O&M), the National Water Pol icy states that: “The management of publ ic water schemes, barr ing municipal schemes, with command area up t o 5,000 ha wi l l be gradually made over to local and community organizations and their O&M will b e financed through local resources;” (p. 9) “For the foreseeable future, however, cost recovery for f lood control and drainage (FCD) projects i s not envisaged in this policy. In case o f f lood control, drainage, and imga t ion (FCDI) projects water rates wil l b e charged for O&M as per Government rules.” (p. 16) “Water charges realized f r o m beneficiaries for O&M in a project would b e retained local ly for the provision o f services within that project.” (p. 16)

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local stakeholders request support to refine the impact that major infrastructure i s already providing.*’

Operation and maintenance o f water supply and sanitation systems i s adversely affected because local government institutions are only peripherally involved in planning and implementing the systems and because they have limited access to resources. The Water Supply and Sanitation Policy (1998) recognizes these problems and promotes a stronger role for local government institutions and other community-based user groups in the provision o f services. A long with much improved operation and maintenance, there i s an urgent need for water quality surveillance and monitoring because o f the health risks associated with various contaminants, including arsenic, which poses an additional challenge.

The fol lowing chapters present the history and challenges o f the water resources sector, as we l l as the service sectors (irrigation, fisheries, water supply and sanitation, and inland water transport), and outline possible engagement by the Wor ld Bank in supporting their development.

22 For example, several subprojects have been implemented that provide facilities to f lush water through the Gorai le f t bank embankment. Other subprojects are designed to ref ine water management local ly within the larger coastal polders constructed by the BWDB. I t should be noted that some o f these cases are viewed by the BWDB as interfering with their infrastructure.

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4. T h e W a t e r Resources Sector

Background 4.1 Efforts to systematically develop Bangladesh’s water resources started in the 18* century and

were expanded under the Zamindar system, extending to the present. During this time the water resource information base has improved, analytical processes have been strengthened, and the institutional and policy framework has evolved. In addition, a significant amount o f infrastructure has been put in place to manage water for more economically productive purposes.

Following the establishment o f a Water and Power Development Authority, an outcome o f a 1954 United Nations Technical Mission, a Water Master Plan was completed in 1964. Th is plan emphasized large-scale publicly financed surface water development, overestimated public sector capability, and overlooked the country’s groundwater resources. In 1972 the World Bank supported preparation o f a Land and Water Resources Sector Study, which promoted a radical shift in strategy to minor development using low-lift pumps to irrigate with surface water and tubewells to imgate with groundwater. The f i r s t framework National Water Plan, sponsored by the United Nations Development Programme (UNDP) and executed by the Bank, was produced in 1987 and was followed by a second phase that was to operationalize i t s main strategic thrusts and produce an investment plan for 1992. However, the advent o f the devastating 1987 and 1988 floods refocused attention on this hazard and the internationally sponsored Flood Action Plan (1989-1994) resulted. In 1995, keying o f f work undertaken in the Flood Action Plan, a Water and Flood Management Strategy promoted a broader technical approach to water resources planning and a reduced public sector role in water management, identified the need for a National Water Policy, and recommended preparation o f a broad-based National Water Management Plan that would be guided by the policy. In the 1999 government declared the f i rs t National Water Policy. The policy has spawned a number o f related initiatives including the preparation o f a National Water Code, completion o f a National Water Management Plan (approved in 2004), and finalization o f the Guidelines for Participatory Water Management. In March 2003 the government prepared an Interim Poverty Reduction Strategy. The Poverty Reduction Strategy Paper (PRSP) entitled Unlocking the Potential - National Strategy for Accelerated Poverty Reduction, was then released in October 2005. The PRSP now forms the core o f future Three- Year Rolling Plans and provides the basis for annual budgets, guiding water management investments through i t s development strategy.

An extensive policy framework exists, developed mostly over the last 10 years, to govern water resources development and management. Key among these are the declaration o f the National Water Policy in 1999; the National Water Management Plan; progress towards declaring a National Water Code; and preparation o f a Coastal Zone Policy (2005). In addition, several important water-related policies have been established for other sectors, including, the National Environment Policy (1 992); the National Forestry Policy (1 994); the National Energy Policy (1 996); the National Policy for Safe Water Supply and Sanitation (1998); the National Fisheries Policy (1 998); the National Agriculture Policy (1 999); and the National Arsenic Mitigation Policy (2004). The National Water Management Plan identified two gaps in the policy framework. The f i rs t related to the need for land use planning to address issues related to urban expansion, including urban development o f industry, energy, education, and health, as well as urban water development. The second related to the need for an integrated transport policy that would support more rational investment decisions and improvements in transport quality across the various modes o f transport.

Institutions relevant to the water sector exist at national and local levels. The national institutions comprise some 35 central government organizations affiliated with 13 different ministries. The local government institutions include 4 c i t y corporations, 206 municipalities, and the local

4.2

4.3

4.4

Chapter 4: The Water Resources Sector

government administrations at the levels o f district (64), thana (464), union (4,45 I), and village (86,500). NGOs and the private sector have also played a key role in the development o f water resources. The National Water Management Plan envisages some key changes in the institutional framework o f the future. The sector i s l ikely to be managed through national and regional framework plans that reflect government policies as wel l as stakeholders’ demands. The plan foresees a sector that i s regulated under l aw with new independent regulatory bodies formed to ensure quality and cost-effective water service delivery. The BWDB will be encouraged to operate on a regional basis and the present District-Level Inter-Agency Project Evaluation Committee coordination system will be replaced by district committees under local government. The plan also foresees a strengthened local government that increasingly takes on the task o f managing local water resources for agnculture, water supply, sanitation, urban and peri-urban services, and cyclone protection shelters. The principal departments supporting this effort will be the LGED and the Department o f Public Health Engineering (DPHE).

Since the 1950s, more than 600 water resources schemes have been completed. The majority o f these were intended to increase crop production and varied in size f rom small single-structure schemes with an impacted area o f less than 1,000 ha to large multipurpose schemes potentially impacting o n as much as 100,000 ha. Most were designed to provide f lood control, drainage, irrigation, or some combination o f these. Others provide riverbank protection or r iver dredging.

4.5

Successes: What Has W o r k e d 4.6

4.7

4.8

4.9

In reviewing a range o f investments in the Bangladesh water (for agriculture) sector, there are a number o f recurring common elements that have contributed to better-than-average performance o f initiatives. K e y among these for the public sector-financed schemes i s the stronger (than in the past) involvement o f the end users. In many o f the cited interventions, end user involvement i s confirmed by their willingness to commit t o financial contributions in advance o f receiving services. T h i s has been facilitated by a recent change in legislation that permits financial resources collected for operation and maintenance o f publ ic ly financed water management systems to be retained for local operation and maintenance use. There i s l i t t le commonality in terms o f the local institutional structure put in place to manage the interventions. Some use an informal structure while others, in accordance with the Guidelines for Participatory Water Management, use a formal structure with legally registered organizations. For minor irrigation, the end users are and always have been the driving force.

The assessment i s by n o means quantitative, and the identification o f an intervention here as successful does not necessarily imply that the intervention in i t s entirety was or i s successful but rather suggests that certain elements set the intervention apart f rom others.

Minor irrigation development. Private sector groundwater development for irrigation has been instrumental in the steady expansion o f agncultural output. Rather than government contributing to minor irrigation development, i t has been a source o f net revenue (diesel tax revenue less electricity subsidies) (WARP0 2000). The ownership o f the equipment resides with the end user farmers who cover the entire spectrum o f income groups and who generally provide irrigation water to neighboring plots at competitive prices. Infrastructure quality, management and operation, maintenance, and benefits are not issues since the individual owners ensure that their requirements for the equipment and i t s use are met.

Muhuri Irrigation Project. The Muhuri Irrigation Project consists o f a large closure o n the Feni River that ponds water allowing for pumped offtake f rom a system o f natural and improved waterways. The project was developed at a cost t o government o f about US$2,600 per hectare in the early 1980s. The project development process substantially excluded local stakeholders, the closure dam eliminated the tidal habitat in the r iver mouth with the result that there was a reduction in biodiversity, and there i s n o functioning organization o f the local stakeholders.

23


4.10

4.1 1

4.12

Nevertheless, this project has two desirable aspects: i t i s generally located in an area that i s devoid o f opportunity for minor irrigation development and thus large-scale surface water management infrastructure was the best viable alternative; and the project infrastructure provides farmers with flood control and access to surface water for irrigation through a network o f secondary channels but because the system does not extend to the tertiary level and beyond, development costs are lower. Farmers are responsible for obtaining, operating, and maintaining their own pumps to abstract water f rom these channels, and for the associated f ie ld distribution systems. This they are doing. The major infrastructure that was constructed was of good quality and continues to function effectively and provide the anticipated benefits.

Thakurgaon Irrigation Project. The Thakurgaon Irrigation Project consists o f a cluster o f deep tubewells that were installed in the late 1960s. After a series o f failed attempts to manage the deep tubewells on a user pays principle, local stakeholders recently established a private company called Barindro, which took control o f system assets. The project i s n o w operating successfully with an approach that demands payment in advance at a specified unit rate. Payments are made to pump operators and, upon receipt o f payment, they provide water in accordance with the terms o f the payment o n a f i rs t come, f i rs t served basis to any cultivators within the command area. The system as i t currently operates provides for long-term management, operation, and maintenance of the equipment. Farmers are reportedly happy with the pay-as-you-use system, the organization of water delivery, and the financial transparency.

Small-Scale Water Resources Development Sector Project. The Small-scale Water Resources Development Sector Project provides flood control, drainage, or irrigation infrastructure to subproject areas less than 1,000 ha. The project approach relies heavily o n local stakeholders’ initiative to identify interventions, t o rat i fy engineering design, t o demonstrate commitment to operating and maintaining infrastructure by contributing a specified amount o f funds in advance of physical construction, and to s ign a postconstruction lease agreement for managing, operating, and maintaining the infrastructure. T h i s process has been effective in enough cases to conf i rm i ts viability. M a n y o f the interventions have also contributed effectively to increased food production, and to poverty reduction; some have demonstrated sustainable operation and maintenance. Where success was not achieved, this was the result o f shortcuts that compromised the development process or infrastructure by being o f l o w quality or inconsistent with what was required.

Other interventions provided substantial agriculture benefits to the economy for a time, but the benefits were not sustainable. These include the various interventions in the coastal region, full flood protection projects, as wel l as partial f lood protection provided in the haor areas o f the northeast regon. The lack o f sustainability related to several factors. In some cases, infrastructure was not maintained; in others, institutions to operate them effectively were not in place; and in others, hydrotechnical changes compromised performance. Some o f these interventions were also questionable in terms o f their impact o n biodiversity.

Addressing the Challenges Disaster Management

4.13 Bangladesh has successfully reduced the impact of disasters through community involvement in planning and risk management. Response efforts have included f lood and cyclone warning systems and shelters. However, response efforts st i l l pr imari ly focus o n emergency re l ie f rather than on seeking ways to reduce vulnerability t o natural hazards. There i s a need to strengthen the awareness that risk reduction and disaster prevention make better economic sense than emergency relief, which responds to the consequence o f a natural hazard. Providing a higher degree o f safety from unpredictable hazards allows people to build more economically secure l ives for themselves

24


and their children. This i s o f utmost importance for the poor, as natural disasters divert the resources they need to escape poverty.

River Management

4.14

4.15

Contemporary river management strategies are oriented towards forecasting future erosion hazards, reducing hazards through nonstructural measures such as strategic retirement o f embankments and resettlement o f affected habitation, and developing low-cost erosion control. There has been considerable progress in forecasting future hazards over the last decade through a combination o f tools including low-water satellite imagery, available in the f i rs t months o f each year, and verification river surveys during the flood season. This system allows fo r works to be designed and tendered for the upcoming dry season. The early start i s essential t o avoid major construction activities at the beginning o f the fo l lowing flood season in M a y and June, a result o f which i s low-quality works.

The BWDB i s presently executing three projects uti l izing elements o f this approach: the Jamuna- Meghna River Erosion Mitigation Project, the Flood Act ion Plan 21, and the Environmental Monitor ing Information Network. With the requisite support and commitment, they could establish the capability to plan for erosion hazards on a nationwide basis. In a further development, costs for the protective work o n the ADB-supported Jamuna-Meghna River Erosion Mit igat ion Project, currently under implementation, are expected to be about US$3 m i l l i on per km. T o the extent that the solution being adopted in this project i s effective, i t could be economically feasible to protect agncultural land.

Flood Management

4.16 In response to the mixed impacts o f f lood control infrastructure, the National Water Pol icy promotes a significant shift away f rom past practice. Under the policy, agricultural land everywhere i s t o be adapted to the existing f lood regime. The National Water Management Plan has interpreted this to mean that n o new f lood control i s t o be introduced in rural areas, and that the emphasis n o w i s on improving the performance and management o f existing schemes. That is, within existing flood control schemes, different interventions are to be considered where required o n a case-by-case basis and these interventions are to be driven by stakeholder wishes and their willingness to contribute to costs.

The experience o f the ADB-supported Small-scale Water Resources Development Sector Project implemented by the LGED indicates that stakeholders, at a small scale, will contribute to the cost o f interventions that protect them f rom unusual f lood events or improve postflood drainage. However, it i s also apparent that service delivery must be organized in such a manner that local stakeholders’ representatives are able to make decisions in a transparent and open manner free f rom undue influence o f any particular stakeholder or stakeholder group. Effective delivery o f local stakeholder-sponsored flood management interventions requires that the executing agencies establish mechanisms and procedures to ensure their abil ity to respond to local stakeholders and to devolve authority t o the lowest practicable level.

4.17

World Bank Involvement 4.18 Total investments in water for agriculture have exceeded US$5 b i l l ion and this has translated to

between US$165 mi l l ion and US$260 m i l l i on annually (current prices). Annual government financing for the sector has been consistent for the past two decades at an average o f about US$110 million. Annual project-related donor assistance declined f rom about U S $ l 5 0 m i l l i on o n average during the f i rst ha l f o f the 1990s to about US$55 mi l l ion o n average during the past three years (figure 7). Between 1999 and the present the Bank undertook n o new investments in this sector, which contributed substantially to the overall decline in the level o f donor assistance. Since many o f the donors build o n the experience and expertise o f the Bank in determining their

25


own funding allocations and in developing their own programs, the impact o f the Bank's decision to withdraw support f rom the sector was magnified as others followed suit.

Figure 7. Investment in Water for Agnculture

800.00

700.00

600.00

8 500.00 3 e 3 400.00 ' 300.00

-

200.00

100.00

0.00 1976- 1981- 1986- 1990- 1996- 2001-

80 85 90 95 00 03

Years 0 Total Donor World Bank 0 Government .

4.19 The decline in multilateral and bilateral support to the sector was the outcome o f a general perception that investments needed to be more effective and this required improving a l l aspects o f service delivery. The precipitous decline in Bank support during the last ha l f o f the 1990s was a direct result o f misprocurement. It did lead to the recognition that some fundamental changes in procedures were required. In response, with strong Bank support, the government initiated a series o f reforms aimed at restructuring and rejuvenating key agencies, promoting a process o f participatory water management, rationalizing the national water management planning process, and developing improved systems for service delivery, including more robust procurement systems.

The Bank, through the proposed Water Management Improvement Project, would contribute to government reforms by (a) contributing to integrated rural development by promoting water resources management and thereby helping to increase agricultural and fisheries production and improve conservation o f the ecology by progressively transferring local-level water management functions f rom the government to water management organizations o f local communities; and (b) reforming and strengthening key public sector institutions, for example the BWDB and WARPO, by promoting good governance, accountability, and effective management and delivery of the core public service for improved f lood management, drainage, and cyclone mitigation. T h i s project is, however, currently o n hold.

4.20

Development Partners Involvement 4.21 Since the 1950s, more than 600 water resources schemes have been completed. The major i ty o f

these were intended to increase crop production and varied in size f rom small single-structure schemes with an impacted area o f less than 1,000 ha to large multipurpose schemes potentially impacting on as much as 100,000 ha. Mos t were designed to provide f lood control, drainage,

26


4.22

irrigation, or some combination o f these. Others provide riverbank protection or r iver dredging. In total, Bangladesh’s development partners have contributed about US$2.5 bil l ion. A profi le o f this assistance i s provided in table 2.

Asian Development Bank (ADB). The assistance that ADB provides to Bangladesh i s governed by the Partnership Agreement on Poverty Reduction signed between them in 2000. The five-year operational strategy o f ADB in the water sector, which conforms to the agreement, i s two- pronged: (a) to support government in effectively institutionalizing key National Water Policy principles and guidelines; and (b) to assist government in implementing the National Water Management Plan, while recognizing the need to continuously upgrade these instruments. Implementation o f ADB’s strategy i s guided by several important principles. First, investments need to support a general move towards decentralization - in terms o f the structure o f the implementing agency as wel l as the development o f responsive democratic local government. Second, the investment process needs to promote local stakeholder participation and ownership, which needs to translate into significant operation and maintenance efforts and thus sustainability. Third, multisectoral coordination mechanisms need strengthening.

Table 2. Development Partners Assistance to the Bangladesh Water (for Agriculture) Sector

Countryldonor % o f total donor Grant (%) L o a n (%) assistance

Wor ld B a n k

Asian Development Bank

Netherlands

European Economic Community

United K i n g d o m

Canada

Germany

International Fund for Agricultural Development

Kuwai t

India

United Nations Development Programme

Japan

Saudi Arabia

France

United States o f America

Denmark

Sweden

People’s Republic o f China

Pakistan

40.5

24.4

8.8

4.3

2.8

2.6

2.3

1.9

1.8

1.6

1.6

1.6

1.6

1.3

1.2

0.8

0.5

0.4

0.2

0

1

100

100

10

100

100

0

0 .

11

100

95

35

90

100

100

100

18

0

100

99

0

0

90

0

0

100

100

89

0

5

65

10

0

0

0

82

100

27


4.23

4.24

4.25

4.26

4.27

Government of the Netherlands. The Government o f the Netherlands i s assisting the Bangladesh water sector on a number o f fronts. They work with and support multilateral donors in promot ing local stakeholder involvement in water sector projects, in strengthening the institutional framework by directly assisting existing institutions (the BWDB and the LGED), and in investing in interventions that reverse environmental degradation. The Government o f the Netherlands also has programs that are independent o f other donors and that tackle such issues as development o f capability to promote integrated water management, improved operation and maintenance, support for a center o f excellence for environmental analysis, and the orderly and responsible development o f natural resources in the coastal area. The latter includes supporting new institutional structures.

Canadian International Development Agency. The Canadian International Development Agency (CIDA) i s investing in interventions that promote financial management reform in the Ministry o f Water Resources and the institutions reporting to this ministry. They are also supporting development o f an information network based o n satellite radar technology that i s accessible to the poor and those living in rural areas, assisting the planning and management o f water and land resources on both the national and local levels.

United Nations Development Programme. UNDP has developed programs that help the people and Government o f Bangladesh to develop their capacity to meet development challenges through initiatives that link advocacy, pol icy advice, and projects. With respect t o the principal issues in water resources management, UNDP i s currently focused on initiatives to strengthen local governance and natural hazard preparedness at the national and local levels.

German Development Bank (Kreditanstalt fur Wiederaufbau, KfW). The German Government, through KfW, finances capacity development for planning, implementing, and maintaining riverbank protection. This program i s a direct extension o f the earlier F lood Act ion Plan 2 1 component that conducted applied research o n various bank protection methodologies.

Government of Japan. Three areas o f priority for Japan’s assistance to Bangladesh are (a) agriculture and rural development; (b) improvement o f the social sector; and (c) disaster prevention and management. The focus o f Japan’s assistance to Bangladesh has been shifting to initiatives that a im more directly at mitigating the impacts o f the population on the environment, developing human resources, and reducing poverty. In delivering its development assistance, the Government o f Japan has also shifted towards a more collaborative workmg relationship with other development partners.

28

5. The Service Sectors

Irrigation and Drainage Overview

5.1

5.2

Currently, about 4.5 mill ion ha o f the total cultivable land o f 8 mil l ion ha are irrigated, and the area under irrigation contributes an estimated 13 mill ion metric tons o f cereals (mainly rice) annually to Bangladesh. About 90% o f this irrigation i s provided by the private sector, mainly from groundwater. The studies carried out for the development o f the National Water Management Plan suggest that a further 1 mil l ion ha could be brought under irrigation by the private sector through groundwater development (Halcrow and others 2000). T h i s translates into a potential annual increase in rice production o f as much as 5 mil l ion metric tons, enough to feed an additional population o f between 25 mil l ion and 30 mil l ion people at current consumption rates. This increase in population i s expected within the next 15 years; by 2050, population i s forecast to nearly double to 230 million. While it would be presumptuous to suggest that irrigation alone will be responsible for maintaining the balance between food production and population growth, it i s reasonable to assume that irrigation will need to contribute beyond what can be achieved through private investment.

The National Water Management Plan suggests that government has a role to play in the development o f surface water irrigation systems, where feasible, and to focus where practical on the conjunctive use o f ground and surface water (NWMP, AW 003-1). Additional irrigation with large-scale surface water projects could amount to as much as a further 1 mil l ion ha, a major proportion o f which would be financed by the public sector. Further gains are also possible by diversification to crops requiring less water, particularly in the southwest and western areas o f the country, where rainfall i s low and water i s relatively scarce. I t i s generally recognized that the development o f groundwater for irrigation has required virtually no public sector financing in contrast to a capital cost to the public sector for surface water systems ranging anywhere from US$500 to US$1,800 per hectare.23 I t i s further recognized that farmers readily mobilize the financial and technical resources needed to operate and maintain groundwater irrigation infrastructure, in contrast to surface systems where, in most cases, the cost o f irrigation user fee collection has exceeded the fees collected. The National Water Management Plan also notes that irrigation intensities are low on the 15 major existing irrigation schemes.24 On balance, the large- scale surface water irrigation projects have not had a very good performance history in the country. With appropriate institutional changes, their performance could be increased and if they achieved their potential, they would provide incremental production o f about 1 mil l ion metric tons o f unmilled rice during the winter season. Drainage has generally been provided in conjunction with flood control and/or irrigation and as such i s not accounted for as an independent entity. For the most part, drainage i s effected by gravity, but eight large projects have facilities for pumped drainage.

23 These figures are abstracted from the National Water Management Plan, but arguably may be l ow (Halcrow and others 2000). Capital investment in the Teesta Project was about US$250 mi l l ion in 1985 to develop 100,000 ha o f irrigation. T h l s translates into a unit cost o f US$2,500 per hectare. 24 Most o f the BWDB's large irrigation schemes are designed for supplementary irrigation during kharif-2 (mid- June to December) and rabi season (November to March). W i t h the 15 major BWDB schemes that cover 480,000 ha, between 1996 and 1998, an average 36% o f the net cultivable area was irrigated during kharif-2, and 46% was irrigated from B W D B sources during the winter (rabi) season. During the premonsoon (kharif-1) season, th is figure was 7.

Chapter 5: The Service Sectors

Current Challenges and Approaches

5.3

5.4

5.5

5.6

To develop 1 mi l l ion ha of surface irrigation over a 15-year period will cost over US$lOO m i l l i on per year. In addition, operating costs are expected to increase annually by U S $ l O mi l l ion. In more concrete terms, the incremental unmilled rice production associated with this irrigation development would be publicly subsidized at a level exceeding US$50 per metric ton.*’ There i s presently strong impetus within the government to promote support for a number o f large-scale surface water imgat ion systems, many o f which have their origins in the 1964 Water Master Plan. Current support for new surface water irrigation development i s driven by at least three considerations. First, concerns about the sustainability o f groundwater irrigation persist. Second, there are concerns about arsenic in food crops grown o n land irrigated with arsenic-contaminated groundwater. Scientific studies published so far suggest that the contribution f rom food to total human arsenic exposure i s probably not significant generally in Bangladesh, but could be significant in specific cases (for example specific diets or settings); studies o f this issue are ongoing (Wor ld Bank-WSP 2005). Related concerns are the possibility of arsenic accumulation in groundwater-irrigated soils, which could lead over time to increasing arsenic levels in food crops (or adverse impacts on, for example, yields) (see, for example, Alam, Snow, and Tanaka 2003; Meharg and Rahman 2003; Duxbury and others 2003; Abedin and others 2002; Roychowdhury and others 2002a and 2002b), as we l l as the local contamination o f deep aquifer layers. Third, government policy calls for national food security in the face o f an expanding

Large-scale surface water irrigation projects require considerable lead t ime to move from a concept to the point where they are delivering water to farmers’ fields. Ifone assumes that (a) this lead t ime i s in the order of 10 years; and (b) for the next 15 years, private sector irrigation expansion will increase production sufficiently t o meet the needs o f the expanding population, then there i s a five-year window (2005-2009) during which concrete efforts should be made to improve the performance o f existing schemes. This would include not only physical rehabilitation but, most importantly, concrete changes in irrigation management approaches and the existing institutional frameworks. The current approach o f the government i s to mandate that work on two new major irrigation projects should be initiated every year f rom this point forward. To achieve the desired sustainable food production increases, this would need to go hand in hand with a concerted attempt to improving the performance of existing systems.

The Ganges and Brahmaputra Rivers have strongly influenced the development o f Bangladesh, and they continue to have enormous importance as strategic natural resources. Historically, these rivers have supplied food, provided transport, generated employment, supported a wealth o f biodiversity, and contributed to the overall quality of l i f e for the inhabitants o f these basins. They continue to do so; however, fkesh water quality and availability in these systems i s deteriorating, particularly in the dry season. In particular, the southwest region i s being affected by a shortage of fresh water; increased salinity o f surface water, groundwater, and soils; deterioration of the Sundarban ecosystems; river sedimentation; reduced crop and fish production; and reduced navigability.

The options to address these changes are limited, and difficulties associated with reaching consensus o n h o w best to harness, develop, and share the waters of these international rivers has so far hampered progress. The lives and aspirations of a large and rapidly growing population, both within Bangladesh and within the basins as a whole, are being affected. T o persist in past

25 Based on a 25-year project life, operation and maintenance costs equivalent to 10% o f capital costs, yields o f 5 metric tons per ha, and interest rates of 10%. The cost o f 1 metric ton o f unmilled rice i s about US$165. 26 The government considers that for food production to keep pace with population increases, the irrigated area needs to increase annually by 2% (Division Chief Planning Commission, Dhaka, pers. c o r n . , 2003).

30


approaches denies the grim reality that these resource-rich basins are home to a large and increasing concentration o f some o f the world’s most impoverished people.

Over the past century, the mouth o f the Ganges River has been migrating eastward. This has contributed to the evolution o f the r iver systems in the southwest and has resulted in many o f the smaller distributaries being separated f rom the Ganges main channel. Two distributaries o f significance remain in Bangladesh - the Gorai and the A n a l Khan.27 The Government o f the Netherlands provided assistance to the Government o f Bangladesh in the late 1990s to determine the feasibility o f dredgmg the Gorai River f rom i ts offtake at the Ganges to the rai lway bridge, about 16 lun downstream. This f i rs t stage consisted o f dredging a pi lot channel followed by t w o consecutive years o f maintenance dredging. Subsequently, this pi lot channel largely in f i l led with sediment. The feasibility study based on the pi lot dredging concluded that restoration o f the Gorai River offtake was feasible through a combination o f continuous dredging and structures, including a f low divider, to divert Ganges flows into the Gorai River. The study considered f ive infrastructure options ranging in cost f rom an estimated US$110 mi l l i on to US$198 mi l l ion. There has been n o action to fo l low up o n this study, in part because o f the Bank’s reluctance to engage in the sector and in part because government considers the possibility that investment in the Gorai River would compromise i t s abil ity t o obtain support for a barrage o n the Ganges River.

5.7

Will I t Work?

5.8 The expansion o f private sector irrigation through groundwater development requires that more appropriate pricing policies be put in place. Diesel i s used to power about 90% o f pump sets and irrigates about 70% o f the area. Electricity powers the rest. Present pr ic ing policies subsidize irrigators using electrically powered pump sets and, through taxes, penalize those irrigators using diesel fuel.” It i s estimated that reducing the taxes on diesel fuel by US$0.02 per liter, whi le reducing tax revenues by US$3.7 mill ion, would result in an increase in the area irrigated by 170,000 ha and increase production by 500,000 metric tons. Because o f production costs and l imi ted supply, electricity may not be a suitable source o f power for irrigation and, notwithstanding operation and maintenance advantages, the expansion o f electrically powered pump sets should not be promoted by inappropriate pricing policies.

Development o f selected major irrigation systems in areas where groundwater i s unavailable can work. However, Bangladesh will require support f rom the development partners. A starting point needs to be the identification o f h o w improvements can be made to the operation o f existing surface water irrigation facilities with a v iew to establishing effective and sustainable implementation methodologies. At the same time, work i s required to determine environmental f low requirements as a preliminary step to undertalung feasibility assessments o n any proposed schemes. T o date, the government has declared four sites within the coastal zone as Ecologically Crit ical Areas and preservation o f these will require that sufficient freshwater f rom the major river systems f l ow through the coastal areas to prevent further salinization, drought, and the corresponding destruction o f biodiversity and habitat.”

5.9

27 The Aria1 Khan i s in fact a distributary o f the lower Ganges or Padma River. 28 In 1996, the National Minor Irrigation Project reported that the economic price o f electricity (including generation and transmission) was 230% o f the financial price while the economic price o f diesel was 56% o f the f i a n c i a l price. As a result the financial cost o f irrigating wi th diesel was about US$70/ha while the financial cost o f irrigating with electricity was US$40/ha. The effect o f t h s i s that more than 35% o f the total economic cost o f power i s used to irrigate less than 30% o f the irrigated area. 29 The Ecologically Critical Areas are: Tekhaf Bay at Cox’s Bazaar, Saint Martin’s Island, Sonadia Island, and areas around the Sundarban Reserve Forest.


5.10 The Ganges Water Treaty represents good progress in establishing a stable framework within which Bangladesh can begin to plan for the development o f the main rivers for multipurpose uses in accordance with the National Water Policy. Specifically, i t provides some assurance o f upstream discharges so that the Gorai River augmentation project could be implemented with some promise. There are r isks. The Gorai augmentation study did not adequately deal with the issue that the Ganges discharge at the Gorai offtake may be too l o w and this reduces the volume of water available for redirection into the Gorai. A second area o f concern i s that the operation o f the gates at Farakka has led to a steeper recession limb o f the hydrograph. As a result, there are more residual bars and pools that restrict free channel f low.

The Ganges River represents only about 15% o f the total dry season f l ow of a l l the rivers in Bangladesh while the largely uncontrolled Brahmaputra represents more than 65%. Bangladesh could benefit f rom a water-sharing agreement for the Brahmaputra River, which would help to achieve the predictability necessary to plan for development and uti l ization of water in much o f the country.

5.1 1

Development Partner Support

5.12 In general, development partners in Bangladesh promote and support the continued expansion o f private sector-driven groundwater irrigation. Because o f the relatively poor performance o f major surface water irrigation systems in the past, the development partners n o w provide l itt le support for major surface water irrigation. Major surface water projects need to be part o f the water management landscape in Bangladesh. But what i s also clear i s that the evolving irrigation sector has yet to adequately establish worlung systems that result in sound operation and maintenance, especially given that new irrigation projects also imply social costs such as resettlement. Nevertheless, development partner support i s needed to support the improvement o f existing systems and use this as a platform to expand major surface water irrigation.

Water and Sanitation Overview

5.13

5.14

5.15

Bangladesh has made good progress in improving access to safe water. Water supply coverage has increased in both urban and rural areas. Nearly 97% o f the rural population i s served by over 10 mi l l ion hand tubewells. However, arsenic contamination o f groundwater above the permissible limit o f 50 pg/L (micrograms per liter) has affected an estimated 25% o f the shallow tubewells, reducing safe water coverage in rural areas to around 76%. Arsenic in groundwater has affected an estimated 35 mi l l ion people both in urban and rural water areas. Between 10,000 and 12,000 cases o f arsenicosis have been identified so far, and undoubtedly many unidentified cases exist. Figure 8 provides a prof i le o f arsenic occurrence.

On average, more than h a l f the urban population has access to water supply. The four largest cities, Dhaka, Chittagong, Khulna, and Rajshahi, have piped water systems that serve 70%, 33%, 5 1%, and 40% o f the population respectively. An important challenge for these growing cities i s that almost 40% o f the total population i s l o w income and this group i s largely unserved. In addition, only 100 o f the over 250 municipal towns have piped water systems, and these pr imari ly serve urban core populations. The urban population in the slums and fringes o f medium and small towns rely on hand tubewells. Nevertheless, squatters and those living in urban slums are without easy access to water or sanitation.

The gains in water supply have not been matched in sanitation coverage. Recent surveys place sanitation coverage at 33% in rural areas and slightly over 50% in urban areas. The popular technology in rural areas i s the pit latrine, with or without water seal. The sanitation coverage in large towns and cities i s between 65% and 76%. Pit latrines and septic tanks are the technology o f choice in urban areas. Poor drainage decreases soil permeability, malung dense urban areas unfit

32

C'fxaptcr f: 'i'hc Scrvrcc Ssutrrrr


mit igat ion i s incomplete. There i s a need for further research and development, since the mit igat ion options for households or point sources are limited. A l ikely response will b e a shift from po in t source to community-based water supply systems in those villages where this i s socially and financially possible. Despite the significant institutional implications associated with community-based systems, the consequences o f households switching to bacteriologically contaminated surface water poses an unacceptable threat. Arsenic mitigation will therefore be addressed within the overall context o f improving service levels, and mainstreamed in to the water and sanitation sector. The Bangladesh Water Supply Program Project, assisted by the Bank and started up in 2005, wi l l provide important lessons in this regard.

Financing and cost recovery. Water supply systems are heavily dependent o n government subsidies. An analysis o f water supply and sanitation in 42 municipalities in 1986 showed that only 57% o f expenditure was billed, and only ha l f o f that was collected. This resulted in revenue amounting to only 29% o f expenditure. Despite efforts to change this situation, a second analysis five years later found similar results (UNDP-World Bank 1991). However, more recent analysis of 61 district towns where service supply i s supported by the ADB, the Government o f the Netherlands, and the Danish Agency for International Development (Danida) show improvements in both billing and collection efficiency (DPHE 2000), clearly the result o f improvements in service management. This was again demonstrated in the 18 District Towns Water Supply and Sanitation Project, wherein 16 o f the 18 municipalities generated profits before depreciation and three generated profits after depreciation. The situation i s better in the large autonomous Water Supply and Sewerage Authorities (WASAs). In Dhaka, the W A S A i s able to cover operation and maintenance costs, depreciation and financing costs f rom user fees, but i ts collection performance needs improvement; in Chittagong, the W A S A also generates a small profit.

Sector coordination. Sector planning lacks a holistic approach and mechanisms to facilitate participatory planning at the local level. In consequence, planning i s project based and suffers from duplication, misplaced priorities, and uncoordinated development. Agencies are oriented towards meeting physical targets rather than towards establishing and monitoring processes for reaching goals relating to facility operation, management, utilization, and maintenance. To relax this constraint, the Local Government Div is ion has instituted a National Forum for Water and Sanitation with representation f rom sector-related ministries and agencies for intrasectoral and intersectoral coordination. The Unit for Pol icy Implementation, a Danida-supported initiative, has helped the Local Government Div is ion to formulate a vetting guideline to screen a l l new project proposals for compliance with the national pol icy principles. The Unit for Policy Implementation i s also worlung o n a Sector Development Framework, which would be a reference for sector coordination and development.

DFlD has been supporting the Ministry o f Local Government in establishing an Arsenic Pol icy Support Unit (APSU). I t has also become apparent that pol icy and strategy related to arsenic needs to be integrated within the development framework o f the entire sector. The Bank and Water and Sanitation Program carried out a study that confirmed this and calls for a more systematic operational response rather than the current ad hoc interventions (World Bank-WSP 2005). K e y sector donors and government are n o w worlung on a new technical assistance package to unify pol icy assistance support t o fo rm a national Policy Support Unit. I t i s too early to determine the extent to which these initiatives may prove successful.

5.18

5.19

5.20

Will I t Work?

5.21 Inequitable service distribution. Bangladesh’s development partners are responsible for nearly 50% of al l funding for the sector. However, whi le these development partners emphasize capacity building and institutional changes, this financing i s predominantly project based. Consequently, the changes being promoted are unlikely to be sustained beyond the project period unless the

34


5.22

5.23

5.24

government formalizes them through institutional reforms and reorientation. A UNDP project o n good governance has been piloting innovative institutional arrangements that involve local government institutions in local development. Under this approach the union parishads control and manage funds, which the project gives them directly in the form o f annual development b lock grants. In i t ia l project experience has been encouraging and it should be monitored carefully in the future.

Arsenic contamination. The economic status and demographic and sociological conditions are not presently conducive to the installation o f large-scale water treatment plants and associated transport and distribution systems. Even urban water supply systems face problems o f inefficient management, unskilled technical staff, capital shortage, inferior quality materials, and inadequate power supplies. The lack o f people’s awareness o f the seriousness o f the arsenic problem and the need to address it i s also impeding mitigation activities. T o expedite resolution o f the arsenic problem, the role o f local government and end users in the management o f water resources needs to be reexamined and brought in l ine with stated government policies.

Financing and cost recovery. Except in large cities, where WASAs are supposed to be managed as profitable corporations, cost recovery, specifically through mobil ization o f local resources, i s not accorded a high priority. In addition, water supply and sanitation (WSS) tariffs are eroded by inflation, as there i s n o mechanism for automatic adjustment; complex tar i f f structures distort consumption and result in unproductive cross-subsidies. In smaller urban centers, where the WSS service i s the responsibility o f the local government, property taxes are potentially the most productive form o f mobilization o f local resources. Yet the revenue base o f municipalities i s both weak and underutilized. Holding or property taxes do not respond to increases in population or economic activity, due to deficiencies in property assessment practices. Nonrealization o f taxes and financing o f recurrent revenue expenditure f rom central government development grants i s common practice.

Service management. Bangladesh has lagged in the efficient management o f services. Even large WASAs are fairly inefficient when it comes to nonrevenue water, metering, billing and collection, or staffing ratios. Central government agencies provide services without paying adequate attention to building local institutional capacity for management. T h i s problem i s acknowledged in the Water Supply and Sanitation Policy (1998), wh ich specifies a larger mandate for local government institutions and user communities in planning, implementing, operating, and maintaining services. At present, those who set pol icy and those who provide services are often the same body, which results in centralized and supply-sided service delivery. The lack o f clarity o f roles and responsibilities o f policymakers and service providers i s a major hurdle that must be overcome if the sector institutions are to become more efficient and accountable. As yet, there i s no go-forward process.

Development Partners Support

5.25 ADB has been supporting the urban water subsector since the early 1980s. I t supported the Secondary Towns Infrastructure Development Projects (Phases I and 11) and the third Urban Development Project. These integrated, multicomponent infrastructure projects included water and sanitation facilities. ADB also supported the f irst Five District Towns Water Supply and Sanitation Project in the mid-1980s and the recently concluded second N ine District Towns Water Supply and Sanitation Project (commonly known as 9-DTP). These projects accorded municipalities a greater role in planning, implementing, and managing their resources. The municipalities worked hand in hand with government agencies in implementing the project. Management procedures were established, rules and regulations framed, and key technical, accounting, and management personnel were trained.

35


5.26

5.27

5.28

5.29

5.30

5.31

5.32

5.33

UNDP i s implementing a Community-Based Water Supply and Sanitation Project, which in response to changing needs i s currently focused mainly o n sanitation and has achieved full sanitation coverage in four unions. The project brings together awareness-raising activities with developing community organizations, appropriate technology, and community participation in al l stages o f service provision and management.

The Government o f the Netherlands’ involvement in the water supply and sanitation sector started in the 1970s with a focus on water supply in district towns. The most recent Dutch support, f o r the 18 District Towns Water Supply and Sanitation Project, focused on water supply, sanitation and drainage, hygiene promotion, and institution building to improve municipal capacity in finance, management, operation and maintenance o f water systems, and hygiene promotion. The Government o f the Netherlands i s now analyzing i t s future role in the water supply and sanitation sector.

Danida has been supporting the water supply and sanitation sector in both rural and urban areas in Bangladesh for almost three decades. Danida recognized that the absence o f a sector development framework and a mechanism to coordinate development constrain a holistic approach to development. In 1999, in the absence o f a development framework for the sector as a whole, Danida shifted f rom a project-based to a program-based approach. Currently, Danida’s support to the sector i s channeled through Sector Program Support. I t focuses on facilitating implementation o f the National Policy for Safe Water Supply and Sanitation (1998) through six components: urban water supply in coastal areas; rural water supply in coastal areas; arsenic mitigation in coastal areas; water and sanitation in the three hill districts; training network at BUET; and services for the poor through the NGO Forum. Danida also has two new projects in the final planning stages, which will increase water supply, improve sanitation coverage, promote hygiene, and strengthen institutions in the eight coastal districts.

WHO supports a number o f ongoing projects that provide assistance with water quality surveillance, promote better sanitation through training and pi lot projects, provide capacity building for the DPHE and the sector, and reinforce arsenic mitigation programs through research, training, establishment o f protocols, laboratories, and information systems, and through provision o f monitoring and advisory support.

For the past several years the Japan International Cooperation Agency (JICA) has focused o n the provision o f arsenic-free drinlung water, mostly in northwestern Bangladesh. Upcoming projects continue to concentrate o n improving the quality o f drinlung water: in one project by establishing three water quality laboratories and in a second project t o provide arsenic-free water o n a sustainable basis to communities in three upazilas o f Jessore District.

WaterAid, with financial support f rom the DFID, has a substantial ongoing program targeting 2.2 mi l l ion beneficiaries and aiming to provide sustainable improvements in hygiene behavior and reduce exposure to water and environmental sanitation r i s k s for entire poor rural and urban communities.

The United Nations Children’s Fund (UNICEF) i s in the process o f preparing a new country program. I t i s anticipated that activities in water supply and sanitation will support community- centered approaches to achieving national goals. The program i s planned to be o f sufficient scale to produce a reliable evidence base to contribute to sector policies and strategies and, therefore, to be instrumental in designing a sectorwide approach.

A broad group o f NGOs and others have been working extensively to support government in dealing with arsenic and i t s mitigation. These include the Dhaka Community Hospital, Proshika, the Bangladesh Rural Advancement Committee, the Asian Arsenic Network, and the NGO Forum

36

Chapter 5: The Service Sectors _ _ _ _ _ ~ ~

for lhnking Water Supply and Sanitation. The partnership o f these and other NGOs provides an important ally for the government in dealing with this diff icult issue.

The Water and Sanitation Program for South Asia (WSP-SA), through i t s Bangladesh country office and i t s regional and global units, i s supporting government, sector institutions, NGOs, and development partners. This support consists o f technical assistance, demonstration projects, upstream project preparation, pol icy advisory assistance, and improvement o f service delivery, sharing research and knowledge that leads to reforms in sector policy and institutions. The WSP- S A has concluded that “it i s the institutions that need to be fixed before fixing the pipes delivering water to consumers”. The upstream work o f WSP-SA o n arsenic mitigation produced a key reform agenda for sector institutions and identified new ways to improve service delivery. These included piped water supply with private sponsors for high-density rural areas, emulating the global success story o f small-scale private providers in delivering rural water supply, and a new approach to dealing with sanitation through collective and community behavioral change that results in a totally sanitized community rather than the partial coverage that results f rom simply providing hardware.

Inland Water Transport Overview

5.34

5.35

5.36

5.37

Transport accounts for about 8% o f GDP and water transport accounts for about 15% o f total transport GDP (Bureau o f Statistics 2000). In land water transport moves about 30% of total freight and about 14% o f total passengers, compared with 7% and 13% respectively for ra i l and 63% and 73% respectively for road. Water transport depends entirely o n adequate water depths and i s thus particularly vulnerable to the effects o f siltation, declining r iver flows, and flood management infrastructure constructed across watercourses. Inland water transport i s the least expensive fo rm o f transport in Bangladesh and in the southwest part of the country the most cost effective. There are presently about 6,000 km o f navigable waterways in the summer and 3,800 km in the winter. This i s significantly lower than in 1970 when the navigable waterways during the summer were about 13,500 km and the winter waterways were 8,500 km in length. An estimated 3 m i l l i on people rely o n inland water transport for their livelihoods.

By 2015 the actual volume o f inland transport freight and number o f passengers i s forecast to increase by 70% and 50% respectively, even as i t s share o f total freight and passengers are forecast to decrease to about 17% and 8% respectively (notwithstanding i t s cost advantages and livelihood benefits).

Waterway maintenance will be essential, given the expected rapid increases in actual freight and passengers. However, the volume o f dredging that i s being undertaken to maintain the waterways has declined from a mid-1980s annual level of 3 m i l l i on m3 to about 2.7 m i l l i on m3. This reflects the proportionately lower budget allocation the subsector receives. In FY02 inland water transport accounted for more than 25% o f commodities and passenger movement, but was allocated only 6.6% o f government investment in the transport sector.


5.38 In promoting development and more efficient resource uti l ization in the sector, a number o f challenges need to be addressed. The navigability o f many of the rivers i s declining due to a combination o f reduced dry season discharges and siltation in the channels. These problems are exacerbated by the difficulties associated with predicting morphological behavior o f many o f the rivers. The response has been less than effective because o f a number of related difficulties. Poor planning, programming, and management have resulted in inadequate capital funding for necessary interventions to improve the navigability. Inadequate recurrent budget allocations have fostered weak management and poor monitoring and control systems, leading to l i t t le or n o

37

Chapter 5: The Service Sectors ~

5.39

5.40

5.41

maintenance o f associated physical facilities such as mooring and storage facilities, theft o f navigation aids, lack o f modernization o f country boats, and l i t t l e expansion o f rural launch facilities. A further issue i s that mooring stations are often not properly integrated into the road network.

The Department o f Shipping and the Bangladesh Inland Water Transport Authority are the two main organizations responsible for the development and regulation o f the sector. The regulatory framework consists o f the Inland Water Transport Authority Ordinance (1958) and the Inland Shipping Ordinance (1976). There i s some ambiguity as to the responsibilities o f the regulatory bodies and there i s a need to redefine the responsibilities o f the organizations. These organizations also require strengthening and an early step in this process wou ld be a review o f staffing in the context o f roles, functions, and required s h l l s .

The current approach i s one that promotes an agenda for increasing public-private partnership in the sector, improving facilities in the areas o f communication, navigation aids, and smaller landing facilities, as wel l as strengthening service delivery through human resource development and adopting measures to prevent accidents. This has resulted in the signing o f a number o f development service agreements including preparation o f a private sector por t and inland water transport policy, and several infrastructure schemes to be operated on a BOT basis: construction of Khanpur container terminal at Narayanganj, construction o f a new r iver terminal at Paanga opposite Pagla (Dhaka), and establishment o f land ports at T e h a f and Banglabandh. T o improve operational efficiency, steps have been taken by Bangladesh Inland Water Transport Corporation to lease or charter i t s loss-generating cargo fleets to the private sector. Procurement o f three dredgers and one booster pump is planned to support a long-term dredging program to excavate 8.8 m i l l i on m3 o f material f rom 19 r iver routes.

In addition, government has allocated i t s own funds for a number o f initiatives that are to be under implementation by 2007:

0

0

0

0

0

Establishing r iver port facilities in the Munshiganj-Mirkadim area.

Constructing a bus and truck terminal at Paturia ferry landing.

Dredging the canal connecting the Dhaka-Mongla and Chittagong-Mongla waterways.

Providing landing facilities in the coastal upazilas Cox’s Bazaar, Sandwip, and Monpurar.

Undertahng measures to reduce vessel accidents, including ship model testing, weather forecasting, and modernizing o ld passenger launches.

Will I t Work?

5.42 The National Water Policy and the National Water Management Plan place a high pr ior i ty o n the maintenance o f the inland water transport subsector. A Master Plan for In land Water Transport was prepared in 1989 that takes account o f the various challenges facing the sector and suggests appropriate measures. Whi le many o f the recomniendations o f the master p lan have not yet been adopted and government support t o the subsector i s disproportionate to the contribution o f the subsector to the economy, an approach that incorporates substantial private sector involvement holds promise. Nevertheless, t o effectively implement this approach will require significant changes to the manner in which government agencies undertake their business and t h i s in turn requires further reforms and capacity building.


5.43 Historically, Bangladesh has received support for inland water transport f rom the Government o f the Netherlands, Danida, and the Wor ld Bank. However, over the past decade, support f rom these development partners has dwindled, in part because government i tsel f accorded l o w pr ior i ty t o

38


the sector. Danida withdrew its assistance to the sector becaus‘e o f misprocurement related to the rehabilitation o f ferries; this work was undertaken by the Bangladesh Inland Water Transport Corporation. The Wor ld Bank financed the Inland Water Transport I11 Project and has been prepared t o finance a follow-on Inland Water Transport N Project. However, the latter has been stalled due to disagreements between the government and the Bank. An outcome o f this i s that the recommendations o f the Inland Water Transport I11 Project have not been implemented. Currently, a Sector Policy Note i s under preparation to address the way forward. Spain i s providing financial assistance for the procurement o f three dredgers and one booster pump.

Fisheries and Environment Overview

5.44 The fisheries sector o f Bangladesh includes inland and brackish water aquaculture, and inland and marine capture fisheries. The sector accounts for 6% o f the GDP, provides 9% o f the country’s employment, and i s the second most important source o f foreign exchange. According to the Bangladesh Bureau o f Statistics fisheries are the only activity in rural Bangladesh showing significant expansion, with an annual growth o f 8.4%. Four out o f f ive rural Bangladeshis depend to some extent on aquatic resources. The government estimates that over 1 m i l l i on people f i sh full time and another 11 mi l l ion professionally on a part-time basis. Fish are reported to account for 65% o f the country’s animal protein consumption.

Aquaculture, both fresh and brackish water, has shown annual growth rates exceeding 10% over the past decade. M u c h o f that production i s a result o f uti l ization o f existing ponds and technologes. High levels o f growth are expected to continue as long as internal prices remain stable and shnmp exports are not reduced, thereby continuing to provide incentives for shmp farmers to increase production. The Fisheries Sector Review and Future Development Study have elaborated estimates for current and projected sector outputs. The quantity o f fish produced i s forecast to continue to grow at an average annual rate o f 1.5% over the coming decade (table 3), driven by strong growth in aquaculture. At the same time, fish prices are expected to continue to increase at an annual rate o f 2.7% f rom the current value o f US$730 per metric ton, resulting in an annual increase in production value estimated at 4.2% (FSRFD 2003). But capture fisheries, both inland and marine, are declining and this trend i s l ike ly to continue without an infusion o f polit ical will, changes in current policies and institutional arrangements, and additional investments.

I t i s unlikely that internal production will keep pace with internal demand. Consequently, i t i s l ikely that prices will continue to rise further, malung fish protein less accessible to the poor. Imports, mostly f rom India and Myanmar, are becoming increasingly important to markets across the country. Whi le unlikely to represent more than 5-10% o f the overall fish consumed in the country, anecdotal information indicates that imports may be impacting prices, particularly prices o f cultured carps and catfish in urban markets. The lack o f reliable statistics does not al low an informed answer to this important question.

5.45

5.46

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Table 3. Summary o f Major Fish Subsector Scenarios

Production sector 2002 2012 (est.) Annual change (metric tondyear) (metric tonsiyear) (percent/year)

Inland aquaculture 850,000 1,465,744 5.6

Coastal aquaculture 94,580 129,597 3.2

Inland capture fisheries 750,419 606,919 -2.1

CoastaYmarine capture fisheries 589,500 501,689 -1.6

Totals 2,284,499 2,703,949 1.5

5.47 The rivers around a l l the major cities are heavily polluted. The Buriganga and the Lakhya Rivers around Dhaka absorb about 80% o f the city’s effluent. In addition, the Department o f Environment has identified more than 450 polluting industrial units discharging toxic wastes into these rivers. Revitalization o f the rivers around the major cities was not adequately addressed in the National Water Management Plan, but it i s badly needed.

Permanent wetland areas in the country have declined by 50% and continue to decline. Wetlands provide essential environmental services to al l Bangladeshis in the way o f f lood protection, water purification, and groundwater recharge, among other services. Apart f rom these direct services, wetlands serve as nursery and breeding grounds supporting fish production. Development practices need to more aggressively support the maintenance o f perennial habitats or minimum stream f lows to ensure that sufficient parent stock are available for repopulation o f the f lood plain fishery, which i s the key to the capture fishery in Bangladesh.

5.48


5.49 Inland aquaculture, which produces an estimated 850,000 metric tons with over 80% f rom smallholder pond polyculture, i s the largest single source o f fish amongst the various fisheries subsectors. This should be viewed as a major success o f the government and i t s fisheries agencies. Other areas of importance include seed production, pen and cage culture, and commercial aquaculture. Small pond carp polyculture will continue to offer the greatest potential for expansion and increased production within the fisheries sector. N e w ponds continue to grow at a rate o f 2% or more per year.

K e y issues in the subsector, particularly for poorer farmers, are (a) availability o f information; (b) extension support; and (c) quality o f available fish seed and access o f the poor to production units. Landless and marginal farmers and the f i sh seed industry will require additional investment and technical support. Government-NGO partnerships have proven to be the most effective means for promoting and improving smallholder aquaculture. Smallholder aquaculture does, and will continue to, offer opportunities for rural poverty reduction and investment.

Brackish water aquaculture produces almost 95,000 metric tons o f shrimp, prawn, and fish and this amount i s expected to double over the next decade. Shrimp exports are n o w the second most important source o f foreign exchange in the country. Mos t o f the current investment i s and wil l continue to be undertaken by the private sector. Increase in total shrimp production could b e achieved by improving culture systems without expanding the total pond area, although the latter i s unlikely to happen. Improved approaches will require better operational management with the support o f extension services, improved pond construction, better hatchery and water management, reduced postlarvae mortality, improved stocking ratios, and, most importantly, improvements in postharvest handling.

5.50

5.5 1

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5.52 Shnmp and prawn aquaculture are profitable and practitioners are, for the most part, able to finance their own activities. Strateges addressing the key issues o f this subsector would main ly involve government and private sector coordination and cooperation. Fo r organizations with a poverty reduction focus, direct investment opportunities are limited. Apart f rom supporting poor fishermen involved in the capture o f wild postlarvae, i t i s diff icult t o identify areas within this

*

5.53

5.54

5.55

5.56

subsector where poverty-focused investment would be justified.

Open water capture fisheries (inland and marine). Poorer landless sectors o f rural society depend substantially o n the open water capture fisheries. The yearly output of in land capture fisheries i s progressively declining. This i s primarily due to habitat loss, reduced dry season flows, and unregulated overfishing as wetlands and other aquatic resources are lost to infrastructure, agriculture, urbanization, and increasing pollution. The primary emphasis in both the marine and inland capture fisheries must remain o n maintaining current levels o f output within the increasing constraints o f land and water use, urban and agricultural intensification, and social pressures on poor communities. Individual species o f high-value f ish and their fisheries are disappearing. The consequence o f these declines will most impact the rural poor in terms o f income and access to food. Maintaining present levels o f production, preserving current biodiversity, and sustaining existing livelihoods should be considered as pr ior i ty objectives.

Interventions and investments are required if these resources are to continue to supply income, food, and essential environmental services to the poorest members o f society. Results from a number o f ongoing Department o f Fisheries investments have given rise to general agreement that the most effective means o f addressing these issues are through integrated approaches that address policy, strategies, and interventions in a coordinated manner; that is, participatory approaches integrating social, technical, and polit ical concerns.

Key issues for the sustainable use and preservation o f these capture fisheries include maintenance o f dry season flows, protection o f key aquatic habitats, creation and maintenance o f fish sanctuaries, l imitation to further disruption o f migratory pathways, and avoidance o f further pollution and chemical degradation. In addition, the future o f the subsector will require a reduction o f fishing effort. Recent small-scale efforts have shown that communities worlung with local government (district, upazila, and union) are capable, with technical and other support, o f sustainably managing local resources. Accomplishing this will probably require integrating alternative income-generating activities with wetland and fishery management. There i s a need for the government, NGOs, and donors to continue to cooperate and coordinate efforts to establish these approaches at the pol icy and institutional levels.

Wetlands management and poverty. Wetlands seasonally cover 60% or more o f the country. Infrastructure, both for water management and transport, has been a major contributor t o the ongoing decline in wetlands. Recent wetlands economic studies in Bangladesh (Colavito and others 2000) indicate that wetlands have annual economic outputs exceeding US$5 15 per hectare.30 These studies have shown that the main economic benefits f rom these common property resources go to poor people in rural communities. In addition, the nation as a whole benefits fi-om the environmental services provided by wetlands in the way o f f lood control, groundwater recharge, and pollution abatement. They also produce food and other r a w materials. A similar situation exists in the marine and coastal fisheries where the poor depend on aquatic resources. Any strategy that addresses poverty alleviation in rural Bangladesh must take these fisheries and aquatic resources into account. Boro rice cultivation requires an inordinate amount o f water, which creates problems in a season o f water scarcity, when competing users include urban and village communities and other lower-use agriculture crops, fisheries, and wetlands.

According to the Bureau o f Statistics, 1 hectare o f boro r ice i s valued at US3 10. 30

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Will I t Work?

5.57 Fisheries and poverty. Price i s an important factor in maintaining access to f i sh by the poor. Current and projected annual price increases o f about 2.8% over the next 10 years will translate into lower consumption, particularly for the poor (FSRFD 2003). Act ion that results in sustainable increases in fish supplies and stable or lower fish prices will benefit the poor. One straightforward way to do that i s to encourage imports. Current policies do not support this approach.

Wetlands and fisheries. Wetlands provide essential environmental services to a l l Bangladeshis in the way of f lood protection, water purification, and groundwater recharge, among other services. Apart f rom these direct services, wetlands serve as nursery and breeding grounds supporting fish production in other areas. In Bangladesh these wetlands are the critical element in the production o f 650,000 metric tons o f marine and coastal fish and 750,000 metric tons o f inland fish. Current development practices do not aggressively support the maintenance o f perennial habitats or minimum stream flows to ensure that sufficient parent stock are available for repopulation o f the flood plain fishery, which i s the key to the capture fishery in Bangladesh. Despite indication that economic outputs o f wetlands exceed that o f agriculture production, permanent wetland areas in the country continue to decline, mainly due to the construction o f infrastructure related to development o f water resources for agriculture. Agriculture benefits are easily defined and are concentrated in a relatively small population, whi le outputs f rom a natural (common property) wetland are shared among a much larger and diverse group o f stakeholders.

Institutional. It i s unclear which government organization i s responsible for the wetlands o f the country. The Ministry o f Environment and Forests i s responsible through i ts departments for the most important wetland areas in the country (Sundarban and Tanguar Haor) and has overall responsibility for protection o f biodiversity. The Ministry o f Environment and Forests i s the only organization tasked with the management o f protected areas in the country. The Ministry o f Fisheries and Livestock, o n the other hand, has the technical understanding, the experience in community initiatives, and the personnel at the upazila level with the abil ity t o work with local government and local communities to implement those tasks. Establishing and implementing a coordinated cross-sectoral approach to fisheries sector development should be considered as a long-term goal, requiring f i rst o f a l l pol icy reform leading to development o f (a) the National Fisheries Policy to address broad development goals within a cross-sectoral forum and in the context o f the PRSP; (b) an implementation strategy; and (c) modalities for pol icy implementation and monitoring.

5.58

5.59


5.60 For the past three decades, development partners, including the Wor ld Bank, have assisted the government in the development o f inland and shrimp aquaculture and management of inland open water capture fisheries. Almost US$350 m i l l i on has been invested by the multilateral and bilateral donors over the past 25 years. Overall financial assistance has been reported to have been allocated, in decreasing order o f importance, t o (a) aquaculture (49.6%); (b) inland open water fisheries (39.4%); and (c) coastal and marine capture fisheries (3.7%). At present, inland aquaculture continues to be strongly supported by other development partners. Brackish water (shnmp) aquaculture i s rightfully led by the private sector with some support f rom Government of Bangladesh agencies. The inland capture fishery subsector i s receiving consistent support f rom international donors, whi le the coastal and marine capture fisheries have no t benefited f rom the long-term support that has been granted to aquaculture and the inland capture fisheries. In the past two decades, only 3% o f the total government and external support has been directed to the marine capture subsector.

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6. Priorities for World Bank Engagement

Preamble 6.1 Managing water resources i s a continuing challenge and opportunity in Bangladesh. Over

the past four decades, the government and the private sector have responded to the changing social, economic, and technical environment. These adaptations have contributed to substantial changes. Cereal production has increased f rom about 7.5 m i l l i on metric tons to more than 25 mi l l ion metric tons annually. In land aquaculture i s producing an estimated 850,000 metric tons annually, though capture fisheries have declined. Safe drinhng water has been provided to more than 75% o f the rural population and more than 50% o f the urban population. Sanitation coverage exceeds 30% in rural areas and 50% in urban areas. Nevertheless, despite the evolution o f policies, programs, and plans, remnants o f past approaches persist. Just as actions pr ior to 1971 were no t a guide to the next three decades, so too the past 30 years may not be a guide to the next 30 years.

What follows are priorities for Wor ld Bank engagement. These cut across al l o f the water-related sectors and are intended to provide a portfolio that will assist the Government o f Bangladesh in achieving i t s development goals in a balanced and rational manner.31 The portfolio aims to address:

0 The institutional framework, including the responsibilities of different actors; and standards for water quality and service provision (especially for the poor), for the environment, for land use management, and for construction and management of infrastructure, which affects the quantity and quality o f water resources at various levels

0 The management instruments, including regulatory arrangements; financial instruments; standards and plans; mechanisms for effective participation o f stakeholders; and knowledge and information systems that increase transparency, motivate effective water allocation, use, and conservation, and secure maintenance and physical sustainability o f the water resources system

The development and management of infrastructure, for irrigation, floods, and droughts, and for water quality and source protection.

The political economy of water management and reform, in which there i s particular emphasis o n the distribution o f benefits and costs, and on the incentives that encourage or constrain more productive and sustainable resource use and in which there i s a pragmatic, sequenced and priorit ized reform path.

6.2

0

0

Towards an Effective Investment Portfolio 6.3 The Poverty Reduction Strategy Paper endorses the vision o f the National Water

Management Plan in the development of water resources and proposes policies that (a) promote rational management and optimal. use o f the country’s water resources; (b) ensure equitable, safe, and reliable access to water for production, health, and hygiene; and (c) ensure availability o f clean water in sufficient quantities for multipurpose use and preservation o f the aquatic and water-dependent ecosystems. Also, in accordance with the National Water Management Plan, the strategy specifies priorities that include controlling river erosion, monsoon flooding, and saline water intrusion; improving irrigation and

3 1 Annex 1 summarizes the types o f activities appropriate to World Bank engagement.

Chapter 6: Priorities for Wor ld Bank Engagement

drainage congestion; and mitigating drought through reexcavation o f khals (canals) and channels. These activities would be camed out in the context o f enhancing investment impacts by rationalizing existing flood control and drainage projects, promoting stakeholder participation, and multipurpose use o f f lood embankments.

The PRSP also proposes policies and institutional measures to broaden participatory governance. T h e strategy states unequivocally that decentralization and devolution o f power will be regarded as an essential precondition for good governance and further notes that the consensus view emerging f rom consultations support the concept o f a local government that i s elected and that has financial and administrative power.

The proposed activities to be supported by the Bank would support the PRSP. What follows are long-term programmatic priorities for Wor ld Bank engagement, outl ining programs rather than specific projects. Whi le the Bank would engage in these issues, they constitute major investment areas and would require jo in t and coordinated efforts with other development partners to be effectively and adequately addressed.

6.4

6.5

Dhaka Water Supply and Sanitation Program and Bulk Water System

6.6 Dhaka i s expected to become one o f the world’s mega cities, with the population increasing fivefold in the next 50 years f rom nearly 9 m i l l i on in 2000 to 30 m i l l i on in 2025 and 50 mi l l ion by 2050. This growth wil l put immense pressure o n a l l public services and infrastructure, but particularly o n infrastructure needed for a safe and reliable water supply system for a l l inhabitants. At present, about 70% o f Dhaka’s population i s served by the main public water supply system (around 370 deep tubewells in addition to three small surface water sources). There are also about 400 private deep tubewells serving mainly commercial users. The rest o f the population, mainly the poor and disadvantaged, are dependent on local sources, many o f which are unreliable and increasingly polluted.

A program for Dhaka will require substantial investment in rehabilitation, replacement, improvement, and extension o f the city’s water supply systems to substantially raise and sustain service coverage levels by 2010. T h i s would be accomplished through a combination of public-private sector initiatives to develop major new surface water sources for bulk water supplies, coupled with improvement and expansion o f the main water distribution system based on existing deep tubewells and new surface water sources. Peri-urban and poor communities will be encouraged and supported to develop and install safe handpumps and small deep tubewell-based systems. A project in Dhaka to start addressing water supply, sanitation and drainage issues i s under preparation.

Addressing this issue affects poverty as a targeted improved water service. More than 30% o f the city’s inhabitants l ive in slums and up to 70% o f the total consists o f l ow- income households. As stated earlier, they do not have ready access to water and costs are high relative to users with formal water connections.

There are two main risks. The first risk i s that to improve service delivery will require reforms to the organization and management o f the city’s water services and this will require polit ical commitment. Among other things, the reforms should result in improved efficiency, greater involvement o f the private sector, and effective consumer participation. The second risk leads f rom the first in that the failure to reform the organization and management o f the city’s water services will result in financial resources becoming increasingly constrained, o n the one hand because development partners are unwilling to invest in inefficient sectors, and o n the other hand because local budgets will become increasingly constrained if cost recovery i s not achievable.

6.7

6.8

6.9 ’

44


Integrated Water Management of Greater Dhaka Region

6.10

6.11

6.12

6.13

6.14

The rivers in and around Dhaka are heavily polluted. The major sources o f this pollution are domestic and industrial wastewater discharges. Water pollution exacerbates the problem o f water scarcity and inadequate drainage further increases the exposure of urban populations to the effects o f polluted water. Health surveys show that over 10% o f a l l morbidity in urban areas i s attributable to environmental conditions. The population i s forecast to continue to grow at a rapid rate and, as population increases, problems will become more acute.

The program would build o n the work undertaken as part o f the Dhaka Environment Project camed out under the Bangladesh Environmental Management Project supported by CIDA and would address a number o f cross-cutting themes that would include urban, environment, pollution, water supply and sanitation, drainage, and f lood control issues, and would provide financing to deal with these in an integrated framework, linlung water resources with environmental and water and sanitation service interventions. This would include an assessment o f the Eastern Bypass Project. The program would also support the development o f a policy o n urbanization that addresses the uncontrolled growth o f the urban centers. Other major urban centers require similar programming, and the Dhaka experience would facilitate extension to these other centers.

The Wor ld Bank has a comparative advantage in dealing with the broad range o f urban water-related problems associated with urban development. In addition to technical and financial resources, the Bank can bring to bear experience fi-om various countries in addressing the kinds o f problems encountered here.

Urban water management i s a broad-based water resources intervention that provides regional economic benefits extending to all, including the poor. In 1996 more than 45% o f the urban population was living below the poverty l ine and more than 25% was living in extreme poverty. The urban poor are most l ikely to be subject to the effects o f pollution and to be living in unsanitary conditions. Female-headed househoIds are more l ikely to be in severe poverty than those headed by males.

Implementation o f this program will require strong coordination and cooperation among the government bodies responsible for the various water-related aspects o f urban improvement, and there i s a risk that this coordination may not reach the desired levels. The program will also require capacity building o f many o f the associated institutions; without effective institutional development, gains may not be sustainable.

Chittagong Water Supply and Sanitation

6.15 The government has expressed a willingness to see the Bank involved in supporting improvement o f the WSS service o f Chittagong. A project combining the objectives o f integrated water resource management, improvement o f the overall performance o f the WSS utility, and expansion o f the WSS service, in particular t o low-income communities, i s under preparation as a component o f the Dhaka-Chittagong W A S A project.

Urban and Rural Water Supply and Arsenic Mitigation

6.16 Arsenic contamination i s threatening to undo past achievements in safe water coverage. Almost without exception, the poor suffer most since they have few means to address this issue. Arsenic contamination presents an opportunity to rethink the institutions that define the drinhng water sector and, in particular, to reexamine the role o f local governments and communities in the delivery o f rural services. In other words arsenic mitigation projects, when integrated in an overall water supply vision, can provide a vehicle for

45


6.17

6.18

6.19

institutional reforms for transforming government agencies f rom providers of services to facilitators assisting local governments to help themselves. The Bank i s n o w financing the Bangladesh Water Supply Program Project, which aims to broaden the stakeholder base in rural water supply provision by bringing in private sponsors and involv ing local government^.^' Lessons learned during implementation o f the Bank-financed pi lot Water Supply Program Project should be built upon to design a sectorwide approach program to be supported by the Government o f Bangladesh and donors. The Bank, which has been associated with arsenic mitigation programs since the late 1990s, has a comparative advantage to continue leading the effort. As with other investments in the water supply and sanitation sector, the main r isk i s the absence o f the polit ical wil l and commitment to undertake necessary policy and institutional changes.

W o r l d Bank involvement in arsenic should continue with emphasis o n the following:

e Establishing innovative institutional arrangements and service delivery systems that clearly define new roles and responsibilities for user communities and local government institutions, bringing them to the forefkont o f activities related to planning, implementation, and management o f water services, thereby mainstreaming arsenic considerations into water supply investments and contributing to sustainable investments . Identifying alternative arsenic-safe sources and technologies o f water for dnnlung and cooking.

Protecting the right o f the poor to access to water supply systems.

Building capacity at the local level to plan, implement, finance, and manage water supply services.

Supporting the integration o f groundwater management activities with water supply activities.

Arsenic contamination o f groundwater constitutes a serious health threat and the poor, with l imi ted options in terms o f access to safe water, are the most susceptible. Addressing this issue affects poverty as a targeted improved water service. N o t bringing to bear the slull and financial resources at the disposal o f the Wor ld Bank to address the arsenic challenge would pose diff icult ethical questions.

As with other investments in the water supply and sanitation subsector, the main risk i s the absence o f the polit ical wil l and commitment to undertake necessary institutional changes - changes to ensure the devolution o f authority and decisionmalung, changes to promote transparency, broadening the stakeholder base for public-private partnerships, and changes to the manner in which services are delivered.

e

e

e

e

Wetland and Bee1 Rehabilitation and Management

6.20 The availability o f dry season water will be the most crit ical issue facing the inland capture fisheries o f Bangladesh. It i s estimated that 50% or more o f the perennial wetlands o f Bangladesh have been drained, encroached upon, filled, or otherwise lost in the past 30-40 years. This has negatively impacted the poor, fish production, plant and animal biodiversity, as wel l as a variety o f environmental services that wetlands provide.

Programs that focus o n rehabilitation o f formerly perennial wetlands could include reexcavation of beels or other water bodies, coupled with reconnection o f those water

6.21

32 For more information, visit the project website at www.bwspp.org.

46


bodies with rivers and streams and the addition if required o f small water control structures. Revegetating riparian corridors and reestablishing wetland forests could be a part o f the program in suitable areas. Excavated areas would preserve fish and fisheries and provide fishing opportunities to the poor. Those areas immediately adjacent t o the wetlands could also provide surface irrigation to farmers in the immediate area and would help in preventing further losses o f khas (publicly owned) water bodies to encroachment. Excavation and engineering would more logically be the responsibility o f local government and those government agencies concerned with this type o f work. The Department o f Fisheries, operating through NGOs and local government, could be responsible for overseeing the fisheries management aspects, which would include the maintenance o f minimum water levels, development o f community management organizations, development o f f i sh sanctuaries, closed fishing seasons, and other aspects o f community fisheries management, including alternative income generation.

Addressing this issue affects poverty as a targeted water resource i n t e r v e n t i ~ n . ~ ~ Given the direct connection between the poor and the wetlands o f Bangladesh, and in keeping with the recommendations o f the PRSP, there i s a need to preserve dry season water.

There are two main r isks to this program. B o t h are management related. The f i rs t i s that the poor will be denied access to the fisheries resources created through the program. The second i s that operation o f any water control structures that are put in place are operated in the interests o f a few individuals.

6.22

6.23

Rehabilitation and Rationalization of Existing Infrastructure

6.24 Wh i le the rehabilitation and rationalization o f existing f lood control and drainage infrastructure would adopt sound planning and design principles to ensure that technical, social, and environmental considerations are respected, i t would have an overriding focus o n developing sustainable systems for operating and maintaining infrastructure. Effective operation and maintenance will necessarily require strengthened involvement o f local stakeholders and local government institutions in al l stages o f the implementation process. This i s pivotal to the achievement o f more effective resource utilization. In addition, the rehabilitation design needs to accommodate potential future climate change.

Rehabilitation and the associated challenge o f sustainability are high o n government’s water sector agenda and are reflected in pol icy documents, which include the PRSP and the National Water Policy. The Bank has supported government in constructing a significant proportion o f the f lood control and drainage infrastructure that exists throughout Bangladesh. In some cases existing infrastructure will need to be abandoned or even destroyed to achieve a rational outcome. Infrastructure interventions also need to be coupled with early warning systems and other soft measures to support communities and the ever-burgeoning population to better cope with floods. The Bank provides a multidisciplinary perspective and a broad range of experience and, with i t s abil ity t o link water issues with issues in other sectors, i t can help work towards sensible outcomes. The Bank has also worked closely with government over the past decade to put in place a National Water Management Plan that advocates, as high priorities, the rehabilitation and rationalization o f existing infrastructure; the introduction o f institutional reforms designed to facilitate better management o f a l l aspects o f water resources; and implementation o f the Systems Rehabilitation Project.

6.25

33 This i s a Type 2 intervention as defined in the W o r l d Bank’s Water Resources Sector Strategy. Type 2 interventions are characterized as interventions that simultaneously improve resource management and improve the l ives o f the poor.

47


6.26 Addressing this issue affects poverty as a targeted water resource intervention. Studies have shown that incidence o f poverty extends throughout al l categories o f farmers f rom the landless (less than 50 decimals of land), where poverty i s as high as 64%, to large landowners (owning more than 2 ha), where poverty levels are recorded at 16%. The incidence o f poverty among marginal farmers i s estimated at 44% and among small farmers at 34%. Even in the medium landholding group, about 25% l ive below the poverty l ine. According to the 1996 Agncultural Census, an average 41% o f the land i s operated by farmers classified as small and marginal.

There are two important r isks associated with this program. The f i rst i s that the construction o f capital works will become the dominant objective. This risk i s inherent when delivering services through any centralized agency, but i s o f even greater concern when dealing with the BWDB, as they have yet t o internalize the concept of a demand- responsive approach that i s people centered and has a livelihood-based emphasis. This concern i s further complicated by polit ical involvement in the delivery of services. A second r i s k i s the inabil ity to establish mechanisms to provide sustainable levels o f financing for operation and maintenance. It i s clear that government i s no t in a position to provide long-term operation and maintenance support to al l levels o f infrastructure, and alternative means o f financing will include local stakeholder contributions. However, this will require a sound participatory process, with the BWDB responding to local stakeholders in a transparent and equitable manner.

6.27

Provide Support to Policies and Programs That Expand Minor Irrigation

6.28

6.29

6.30

6.3 1

As defined by the National Water Management Plan, the program would support minor irrigation through improvement o f shallow tubewell and deep tubewell diesel engine fuel efficiencies, introduction o f lower-cost pump sets for force-mode tubewells, and improved irrigation distribution to reduce losses in water-short areas. It would also support appropriate pricing policies for providing power to operate the pumps.

M i n o r irrigation based on surface and groundwater pumping will continue to b e the main source o f irrigation expansion and a key contributor t o future agricultural growth. The present area irrigated by minor irrigation technologies could be expanded to as much as 6.7 mi l l ion ha. This i s consistent with the National Water Policy, which promotes this approach to achieving agncultural water use objectives. The W o r l d Bank’s historical involvement with minor irrigation provides it with a strong advantage in dealing with the challenges associated with supporting the sector. The Bank i s also strongly positioned to address the unknowns associated with arsenic entering the food chain because o f the Bank’s ongoing involvement in managing and coordinating the response to groundwater arsenic in rural domestic water supplies. Promotion o f policies and programs that expand minor irrigation requires simultaneous engagement o n a variety o f issues such as subsidies, arsenic, resource availability, conjunctive use, and monitoring, and these need to be woven into an approach that promotes broader economic development; for this the Bank i s uniquely positioned.

Addressing this issue will have a broad, regionwide impact on poverty. A s reflected in the PRSP, the government’s pr ior i ty i s to develop, through accelerated agnculture growth, rural areas where most o f the poor people live. I t acknowledges the past contribution of minor irrigation to this end and proposes to expand these achievements.

A r i sk to this program i s that government wil l need to respond preemptively to fears, based on incomplete science, o f arsenic entering the food chain. Other r i sks are associated with the availability o f electricity to power electric pump sets, and the purchase price and associated operating costs of diesel pump sets.

48

Chapter 6: Priorities for W o r l d Bank Engagement

Assist with Studies to Better Understand the Major Rivers

6.32

6.33

6.34

The studies would contribute to a better understanding o f development prospects set within the context o f international water-sharing issues. T h i s would include a full-scale assessment o f human and environmental impacts, establishing a scientific basis for determining environmental flows, reviewing and updating the Master Plan for Ma jo r River Training in light o f recent experience, improving the exchange o f information between riparian countries, as wel l as reviewing the potential for and feasibility o f developing major infrastructure o n these rivers. In light o f the l imi ted water available in the Ganges River, these studies would also serve to broaden the country’s development perspective to include both the Ganges, Brahmaputra and Meghna basins.

The studies serve a variety o f purposes. They would seek common interests on the riparian rivers as a basis for building on and promoting regional cooperation. Among other things, a scientifically based assessment o f environmental f lows i s necessary to promote understanding between the upper and lower riparian countries in terms o f the impact o f sharing agreements. The National Water Policy advocates development o f the main rivers for multipurpose use. If the development of, or large-scale abstraction from, the main rivers i s required to expand and sustain food production and environmental systems beyond what can be achieved through minor irrigation and the development o f surface water within Bangladesh, the long gestation period o f such major interventions mandate that work to this end be initiated.

The Wor ld Bank i s we l l placed to support these studies. The issues are complex and the Bank has at i t s disposal a range o f expertise it can bring to bear. Nevertheless, international water management i s intrinsically diff icult and controversial and the Bank cannot unilaterally intervene on controversial proposals (see annex 3 which spells out the Bank’s operational pol icy on international waterways). The Bank’s investment and influence in India i s relatively small and it can only act as an impartial international arbiter when a l l riparians ask it to act. A risk i s also associated with the availability and quality o f data. As stated elsewhere, the data necessary to permit rational planning has been classified as confidential and this lack o f transparency has hampered investment in the past and may we l l continue to do so in the future.

Support Efforts to Manage River Erosion

6.35

6.36

6.37

Riverbank erosion and channel instability hampers development since the permanent r i s k o f erosion prevents long-term planning. Riverbank erosion destroys about 10,000 ha o f land on an annual basis, causing significant economic and social impacts. To address this problem, the National Water Policy requires that government undertakes surveys and investigations to develop and implement master plans for r iver training, and erosion control works for the preservation o f scarce land and the prevention o f landlessness and pauperization.

Work o f this nature i s inherently r i sky , expensive, and carries a high maintenance requirement. Investments in r iver erosion management would be based o n the updated Master Plan for Ma jo r River Training. Whi le the BWDB i s developing considerable experience in implementing r iver erosion protection works, experience with the ADB- financed Jamuna-Meghna River Erosion Management Project suggests that a strong institutional support component will be required to buttress gains that are being made through ADB involvement.

The Bank has long been involved with erosion protection work along the Brahmaputra River, including Sirajgonj town protection, Chandpur town protection, and bank

49


protection for the Jamuna multipurpose bridge. In addition to a strong knowledge base, the Bank brings with it the financial resources to address this diff icult issue.

T h i s i s a poverty-targeted water resource intervention. Social impacts o f erosion include increased impoverishment as individuals and families lose their land, their income, their security, and finally are completely displaced. Their social and economic status pr ior to being subjected to erosion i s largely irrelevant, as the erosion destroys any permanent assets.

Where protection i s provided only for agricultural land, r iver erosion protection i s costly and uneconomical. Lower-cost erosion measures have not yet been proven successful on r ivers of the magnitude o f those in Bangladesh. Further attempts to test novel lower-cost measures will be, by definition, somewhat experimental in nature. Quality o f construction will be decisive: i f poor construction quality leads to failure, technically viable solutions could b e erroneously invalidated.

6.38

6.39

Gorai River Restoration Project

6.40

6.41

6.42

6.43

6.44

The southwest region i s being affected by a shortage o f fresh water; increase in salinity o f the surface water, groundwater, and soils; deterioration o f the Sundarban ecosystems; sedimentation o f the rivers; reduced crop and fish production; and reduced navigability. Increasing the dry season discharge o f the Gorai River would increase the volume o f fresh water entering the southwest region and mitigate some o f the adverse impacts.

The Government o f the Netherlands and the Bank provided assistance to the Government o f Bangladesh in the late 1990s to determine the feasibility o f dredging the Gorai River f rom i ts offtake at the Ganges to the railway bridge about 16 km downstream. T h i s f i rs t stage consisted o f dredging a pi lot channel followed by two consecutive years o f maintenance dredging. Subsequently, this pi lot channel largely inf i l led with sediment. The feasibility study based o n the p i lo t dredging concluded that restoration o f the Gorai River offtake was feasible through a combination o f continuous dredgmg and structures, including a f l ow divider, to divert Ganges flows into the Gorai River. The study considered f ive infrastructure options ranging in cost f rom an estimated US$1 10 m i l l i on to US$198 mill ion.

The Bank has a comparative advantage with respect to the Gorai River Restoration Project. The Bank has in place a partnership agreement with the Government o f the Netherlands and both have had pr ior involvement in the project by assisting in the preparation o f the feasibility study. The project represents a complex mix o f technical and institutional issues that require a multidisciplinary approach and the Bank has a strong comparative advantage in terms o f performance, knowledge, and financial resources as wel l as the abil ity t o integrate these.

This broad, regionwide intervention would provide national and regional economic benefits extending to all, including the poor. Within the coastal zone, which forms a significant proportion o f the region, the functionally landless comprise more than 53% o f the population. T h i s i s slightly higher than the national average. An assessment that associates poverty with caloric intake leads to the result that 52% o f the coastal population are absolute poor and 25% are extreme poor. Extreme calorie intake poverty i s high (above 30%) in Bagerhat District. The rejuvenation o f natural common property resources that can OCCLK with the restoration o f the Gorai k v e r i s expected to reduce the extent o f the poverty in the region.

The risks associated with the implementation of the project include: (a) the volume o f water available in the Ganges Rwer for diversion in to the Gorai River may be

50


insufficient; and (b) the operation o f the gates at Farakka has led to a steeper recession limb o f the hydrograph with the result that there are more residual bars and pools that restrict free channel flow, and it may not be possible to prevent the deep water channel o f the Ganges from migrating to the northern bank o f the river, which would resul t in n o water being discharged down the Gorai.

Inland Water Transport

6.45 Inland waterways are an important part o f Bangladesh’s integrated transport network. A Pol icy Note i s currently being prepared for analysis o f h o w the Bank could reengage in this sector.

Related Interventions 6.46 What follows are interventions that are considered as having a degree o f priority, that

relate to the initiatives that the Bank could undertake, but in which the Bank does no t have a comparative advantage. Nevertheless, in recognition o f the necessity o f these interventions, the Bank will promote the implementation o f these initiatives.

Inventory and Asset Management Plan for Water Supply and Sanitation Sector

6.47

6.48

6.49

6.50

M u c h o f the water supply and sanitation infrastructure in Bangladesh i s either poor ly maintained due to lack o f investment in operation and maintenance or i s reaching the end of i t s useful l i fe. Pnor to further investment in these systems, a better understanding o f their present condition and performance i s required.

An Inventory and Asset Management Plan would comprise a two-year technical assistance project to formulate a 25-year perspective p lan for the major towns o f Dhaka, Chittagong, Khulna, and Rajshahi. The plan would assess the water resources availability and plan for future needs. Part o f the plan could also be financed under the proposed Dhaka Urban and Chittagong Water Supply and Sanitation Project. A practicable investment program could be adopted by the W o r l d Bank and other donors based o n the plans for the respective cities. The Bank has a strong interest in such plans since their subsequent implementation will require substantial financial and technical resources and i t i s in this implementation phase that the Bank can bring significant resources to bear. Whi lst these may be provided with the cooperation and support o f a number o f Bangladesh’s development partners, the Bank i s able to contribute a significant proportion o f both and i s experienced in organizing a coordinated assault o n intractable issues.

Addressing this issue affects poverty as a targeted improved water service i n t e r v e n t i ~ n . ~ ~ Whi le there has been investment in water and sanitation over the past two decades, services in urban areas have eluded the poor and the very poor with the result that access to water i s both diff icult and expensive. NGOs, despite targeting services to the very poor, have found them diff icult t o reach. I t i s critical that the plan carefully addresses this issue and that subsequent investments are initiated with a poverty focus.

The primary r i s k associated with undertalung the Inventory and Asset Management Plan i s the absence or loss o f polit ical willingness and commitment to support potentially significant reforms in both the structure o f the institutions and the manner in which they carry out their day-to-day business. However, reforms will be absolutely necessary if

34 T h i s i s a Type 4 intervention as defined in the W o r l d Bank’s Water Resources Sector Strategy. Type 4 interventions are characterized as interventions that provide targeted services to the poor.

51


services are to be provided to rapidly growing urban populations and the outcome o f a failure to deliver these services i s potentially catastrophic.

Strengthen Fisheries Statistical Monitoring

6.5 1

6.52

6.53

6.54

As in al l forms o f management, fisheries decisionmakers require reliable data in order to evaluate the state o f the fishery and predict the effects o f management controls, particularly gwen the r isk and uncertainty associated with fisheries management compared to other food sectors. Most authorities within and outside the Bangladesh fisheries sector agree that current statistics are not reliable and do not reflect the actual state o f the fisheries. In every area o f the fishery - water areas, aquaculture production, and inland and marine catches - there i s a lack o f reliable information.

Improving the fisheries database involves spreading the ownership o f the data and involv ing universities, foreign research institutions, NGOs, the private sector, and others in c i v i l society in the collection and assessment o f fisheries information. The long-term objective o f a program in this area i s not only to improve management decisions but also to contribute to improved policies so that the sustainable use o f the country’s aquatic resource base i s assured. The purpose o f the intervention would be to develop and implement a sustainable management information system in support o f planning and management o f a l l fisheries-related information.

Addressing this issue will have a broad, regionwide impact o n poverty.35 M a n y mi l l ions o f the poorest people in Bangladesh have essential l ivelihood dependence o n fisheries. They are increasingly vulnerable to threats to the resource and the growing conflicts over the control o f the resource. More reliable data i s expected to y ie ld better decisions leading to sustainable use o f the fisheries resource.

The main r i sks associated with this program are that the data, having been collected, i s not properly archived in a universally accessible manner and that the database will no t be widely available.

Medium- and Long-Term Vision and the FYO6-09 CAS Period 6.55

6.56

6.57

The challenges and priorities outlined above require a long-term vision and many contributors in order to be adequately addressed.

As outlined at the beginning o f this document, the Wor ld Bank’s Water Resources Sector Strategy (World Bank 2003) emphasized h o w water resources development and management are both critical for achieving growth and poverty reduction in a number o f different and complementary ways. An appropriate strategy i s a blend of four types o f interventions: operating o n the resource and o n water services, intervening in a broad, systemic manner, and directly targeting the poor. This strategy mirrors the C A S objectives, which simultaneously seek to improve the investment climate and empower the poor, with governance as a core and overarching issue.

Table 4 summarizes programmatic areas o f support to the water sector by the Bank f rom the perspective o f the poverty impact o f these interventions. The strategic priorities for Wor ld Bank engagement outlined in the table reflect a long-term vision within a broad intersectoral perspective, as mapped out in the CWRAS and the Bangladesh National Water Policy. They provide a balanced approach to underpin growth through providing

35 This i s a Type 1 intervention as defined in the W o r l d Bank’s Water Resources Sector Strategy. Type 1 interventions are characterized as broad, systematic impacts that make water-related infrastructure an essential bui lding b lock for regional and national development.

52


v i ta l broad-based infrastructure and reform, as wel l as targeting the poor at the local level.

Table 4. Medium- to Long-Term Programmatic Areas for Support to Water-Related Activities

Broad interventions w i th Poverty-targeted interventions overall poverty reduction impacts

Interventions affecting water Type I: Type 2: resources, development and Broad regionwide water Targeted water resources management resources interventions interventions

39. Integrated water 45. Wetland and bee1 management o f greater rehabilitation and Dhaka region management

rationalization o f existing flood controVdrainage

40. Rehabilitation and

41. Major river studies 42. River erosion

management 43. Gorai River restoration 44. Inland waterways

Interventions affecting service Type 3: Type 4: sector water and Broad service delivery reforms Targeted services sanitation, irrigation, in land water transport) 46. Dhaka and Chittagong 47. Improved rural, urban,

water supply, sanitation peri-urban service and drainage program delivery (including

continued support to address arsenic contamination)

48. Expansion o f minor irrigation

49. Support to improve management o f existing surface water irrigation schemes

50. Community-based fisheries

Conclusion 6.5 8 Traditionally, the different water-related sectors are treated in isolation, by governments,

development partners, academics, and society at large. This approach ignores the linkages between the underlying water resource base and the service sectors. Water availability, be it too much or too little, and water quality set important parameters for domestic,

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agricultural, and industrial water supply, and therewith have a major impact o n the development opportunities o f a country. Bangladesh i s n o exception.

The effort to develop a comprehensive Country Water Resources Assistance Strategy has been an attempt to bring a comprehensive, integrated approach to bear, and it i s hoped that i t will support a more strategic - and therefore more effective - engagement by the W o r l d Bank in water-related sectors in Bangladesh. In addition, the process o f arriving at this CWRAS, which involved several stakeholder workshops and consultations, will continue to strengthen the already existing basis for coordinated and jo in t efforts by the Bank and the development partners in assisting Bangladesh in the further development o f i t s water sector.

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Annex 1. Types o f Activities for World Bank Engagement: Long Term

Global

Facility

Investment Analytical Technical Environment work assistance lending Initiative

Dhaka and Chittagong water supply and sanitation .I .I .I

Urban and rural water supply and arsenic mitigation .I .I

Integrated water management o f greater Dhaka region .I .I

Wetland and bee1 rehabilitation and management .I

.I Long-term commitment to rehabilitate and rationalize existing flood control and drainage infrastructure

Provide support to policies and programs that expand minor irrigation

Assist wi th studies to better understand the major rivers

Support efforts to manage river erosion .I

Gorai River Restoration Project 4

.I

Inland water transport .I .I

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Annex 2. Relationship between Bank Portfolio and National Water Management Plan

CWRAS MIS ref NWMP Program Name Supported

Cluster: Institutional Development ID 001 Local Government Needs Assessment for Water Management 0

El ID 003 FCD and FCD/I Management Rationalisation 0 ID 004 BWDB Regional and Sub-regional Management Strengthening ID 005 Local Government Capacity Building for Water Management 0 ID 006 WARP0 Capacity Building a ID 007 Department o f Environment Capacity Building 0 ID 008 Disaster Management Bureau Capacity Building 0 ID 009 Department o f Meteorology Capacity Building 0 ID 010 BWDB Capacity Building El

EE 001 Support to the Preparation o f New Legislation 0 EE 002 Field Testing of Participatory Management Models El

EE 004 Project Preparation Procedures - Guidelines and Manuals El EE 005 Regulatory and Economic Instruments El

EE 007 NWRD Improved Data Collection and Processing Facilities 0 EE 008 Water Resources Management Research and Development Studies 0

ID 002 Independent Regulatory Bodies for Water Supply and Sanitation Service Sector

Cluster: Enabling Environment

EE 003 Water Resources Legislation - Preparation o f Supporting Ordinances 0

EE 006 Field Testing and Finalization of the Guidelines for Participatory Water Management 0

EE 009 0 EE 010 0 EE 01 1 Private Sector Participation in Water Management El EE 012 Water and Environment Funds 0 EE 013 Alternative Financing Methods for Water Management El

MR 001 Main Rivers Studies and Research Programmes El MR 002 Main Rivers Abstraction Projects 0 MR 003 Ganges Barrage and Ancillary Works 0 MR 004 Meghna Barrage and Ancillary Works 0 MR 005 Other Barrages and Ancillary Works 0 MR 006 Regional River Management and Improvement 0

El 0 0 El

MR 0 1 1 River Dredging for Navigation 0 MR 01 2 Hydropower Development and Upgrading 0

Water Resources Management Long Term Research and Development Raising Public Awareness in the Wise Use and Management of Water

Cluster: Main Rivers

MR 007 MR 008 MR 009 MR 01 0

Ganges Dependent Area Regional Surface Water Distribution Networks North East and South East Regional Surface Water Distribution Networks North Central and North West Regional Surface Water Distribution Networks Main Rivers Erosion Control at Selected Locations

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CWRAS M I S ref NWMP Program Name Supported

Cluster: Towns and Rural Areas TR 001 Urban Arsenic Mitigation El TR 002 Rural Arsenic Mitigation El TR 003 El TR 004 Rural Water Supply and Distribution Systems El TR 005 El TR 006 Rural Sanitation 0 TR 007 Large and Small Town Flood Protection 0 TR 008 Large and Small Town Stormwater Drainage 0

El M C 002 Dhaka Bulk Water Supply and Distribution Systems El M C 003 Chittagong Bulk Water Supply and Distribution Systems 0 M C 004 Khulna Bulk Water Supply and Distribution Systems 0 M C 005 Rajshahi Bulk Water Supply and Distribution Systems 0 MC 006 Dhaka Sanitation and Sewerage Systems El M C 007 Chittagong Sanitation and Sewerage Systems El MC 008 Khulna Sanitation and Sewerage Systems 0 M C 009 Rajshahi Sanitation and Sewerage Systems 0 M C 01 0 Dhaka Flood Protection 0 MC 01 1 Dhaka Stormwater Drainage El M C 012 Chittagong Flood Protection 0 M C 013 Chittagong Stormwater Drainage El MC 014 Khulna Flood Protection 0 MC 015 Khulna Stormwater Drainage 0 M C 016 Rajshahi Flood Protection 0 MC 017 Rajshahi Stormwater Drainage 0

DM 001 Cyclone Shelters and Killas 0 DM 002 Bari-level Cyclone Shelters 0

0 0

DM 005 Railway Flood Proofing 0 0

Large and Small Town Water Supply and Distribution Systems

Large and Small Town Sanitation and Sewerage Systems

Cluster: Major Cities M C 001 Inventory and Asset Management Plan o f the Water Supply and Sanitation Sector

Cluster: Disaster Management

DM 003 DM 004

DM 006

Flood Proofing in the Charlands and Haor Basin National, Regional and Key Feeder Roads - Flood Proofing"

Supplementary Irrigation and Drought Proofing o f Rural Water Supplies

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CWRAS M I S r e f NWMP Program Name Supported

Cluster: Agriculture and Rural Management A W 001 A W 002

Promotion o f Expanded Minor Irrigation and Improved On-farm Water Management Improved Performance o f Existing Public Surface Water Imgation Schemes

El El

A W 003 New Public Surface Water Irrigation Schemes 0 A W 004 New Public Deep Tubewell Imgation Schemes 0 A W 005 Improved Water Management at Local Government Level 17 A W 006 Improved Water Management at Community Level 0 A W 007 Rationalization o f Existing FCD Infrastructure El A W 008 Land Reclamation, Coastal Protection and Aforestation" 0

EA 001 National Pollution Control Plan 0 EA 002 National Clean-up o f Existing Industrial Pollution El EA 003 National Water Quality Monitoring El EA 004 National Fisheries Master Plan 0 EA 005 National Fish Pass Program 17 EA 006 Unspecified Regional Programs 0

EA 008 Environmentally Critical Areas and Integrated Wetland Management El

Cluster: Environment and Aquatic Resources

EA 007

EA 009 EA 010

Improved Water Management in the Haor Basins o f the North East Region

Improved Water Management and Salinity Control in the Sundarbans Public Awareness Raising and Empowerment in respect o f Environmental Issues

17

El 0

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Annex 3. World Bank Operational Policy (OP 7.50) on International Waterways

Applicability of Policy

1. T h i s pol icy applies to the following types o f international waterways: (a) any river, canal, lake, or similar body o f water that forms a boundary between, or any r iver or body o f surface water that f lows through, two or more states, whether Bank1 members or not; (b) any tributary or other body o f surface water that i s a component o f any waterway described in (a) above; and (c) any bay, gulf, strait, or channel bounded by two or more states or, if within one state, recognized as a necessary channel o f communication between the open sea and other states--and any r iver f lowing into such waters.

2. This pol icy applies to the fo l lowing types o f projects: (a) hydroelectric, irrigation, f lood control, navigation, drainage, water and sewerage, industrial, and ,similar projects that involve the use or potential pollution o f international waterways as described in para. 1 above; and (b) detailed design and engineering studies o f projects under para. 2(a) above, including those to be carried out by the Bank as executing agency or in any other capacity.

AgreementsIArrangements

3. Projects o n international waterways may affect relations between the Bank and i t s borrowers and between states (whether members o f the Bank or not). The Bank recognizes that the cooperation and goodwill o f riparians i s essential for the efficient use and protection o f the waterway. Therefore, i t attaches great importance to riparians' malung appropriate agreements or arrangements for these purposes for the entire waterway or any part thereof. The Bank stands ready to assist riparians in achieving this end. In cases where differences remain unresolved between the state proposing the project (beneficiary state) and the other riparians, pr ior t o financing the project the Bank normally urges the beneficiary state to offer t o negotiate in good faith with the other riparians to reach appropriate agreements or arrangements.

Notification

4. The Bank ensures that the international aspects o f a project on an international waterway are dealt with at the earliest possible opportunity. If such a project i s proposed, the Bank requires the beneficiary state, if it has not already done so, formally t o not i fy the other riparians o f the proposed project and i t s Project Details (see BP 7.50, para. 3). If the prospective borrower indicates to the Bank that i t does not wish to give notification, normally the Bank i tsel f does so. If the borrower also objects to the Bank's doing so, the Bank discontinues processing o f the project. The executive directors concerned are informed o f these developments and any m h e r steps taken.

5. The Bank ascertains whether the riparians have entered into agreements or arrangements or have established any institutional framework for the international waterway concerned. In the latter case, the Bank ascertains the scope o f the institution's activities and functions and the status of i t s involvement in the proposed project, bearing in mind the possible need for not i fy ing the institution.

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6. Fol lowing notification, if the other riparians raise objections to the proposed project, the Bank in appropriate cases may appoint one or more independent experts to examine the issues in accordance with BP 7.50, paras. 8-12. Should the Bank decide to proceed with the project despite the objections o f the other riparians, the Bank informs them o f i t s decision.

Exceptions to Notification Requirement

7. The fol lowing exceptions are allowed to the Bank's requirement that the other riparian states be notif ied of the proposed project: (a) For any ongoing schemes, projects involving additions or alterations that require rehabilitation, construction, or other changes that in the judgment o f the Bank (i) will not adversely change the quality or quantity o f water f lows to the other riparians; and (ii) will not be adversely affected by the other riparians' possible water use. This exception applies only to minor additions or alterations to the ongoing scheme; i t does not cover works and activities that would exceed the original scheme, change its nature, or so alter or expand i ts scope and extent as to make it appear a new or different scheme. In case o f doubt regarding the extent to which a project meets the criteria o f this exception, the executive directors representing the riparians concerned are informed and given at least two months to reply. Even if projects meet the criteria o f this exception, the Bank tries to secure compliance with the requirements o f any agreement or arrangement between the riparians. (b) Water resource surveys and feasibility studies o n or involv ing international waterways. However, the state proposing such activities includes in the terms o f reference for the activities an examination o f any potential riparian issues. (c) Any project that relates to a tributary o f an international waterway where the tributary runs exclusively in one state and the state i s the lowest downstream riparian, unless there i s concern that the project could cause appreciable harm to other states.

Presentation o f Loans to the Executive Directors

8. The Project Appraisal Document (PAD) for a project o n an international waterway deals with the international aspects of the project, and states that Bank s t a f f have considered these aspects and are satisfied that (a) the issues involved are covered by an appropriate agreement or arrangement between the beneficiary state and the other riparians; or (b) the other riparians have given a positive response to the beneficiary state or Bank, in the fo rm o f consent, n o objection, support t o the project, or confirmation that the project will not harm their interests; or (c) in al l other cases, in the assessment o f Bank staff, the project will not cause appreciable harm to the other riparians, and will not be appreciably harmed by the other riparians' possible water use. The PAD also contains in an annex the salient features o f any objection and, where applicable, the report and conclusions o f the independent experts.

1. "Bank" includes IDA; "loans" include credits; and "project" includes a l l projects financed under Bank loans or IDA credits, but does not include development pol icy lending programs supported under Bank loans and IDA credits; and "borrower" refers to the member country in whose territory the project i s carried out, whether or not the country i s the borrower or the guarantor.

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